6. Dezember 2022
R&I Update - December 2022 – 3 von 3 Insights
Re Bitumina Industries Ltd (in administration); Manning and another v Neste AB and another .
This was an application by joint administrators for directions on the validity of a floating charge granted to a connected party at a 'relevant time' and seemingly invalid under s245 of the Insolvency Act 1986 (the Act).
The charge was created as security for the transfer of shares to the company and was challenged by a creditor on various grounds, including that the shares did not constitute eligible consideration for the charge.
A floating charge is not invalid under the Act if consideration is given for it at the time or any time after its creation. Such consideration must consist of "money paid, or goods or services supplied". The charge-holder argued that the shares fell into the category of "goods supplied" and were therefore valid consideration for the charge.
The judge agreed with the charge-holder stating that the meaning of goods should extend to "things in action…and intangibles…which are of a kind received by the Company pursuant to its ordinary trading activity and have a clear value". As the company's business was in relation to the trading of shares, the judge found that the transfer of shares fell within its ordinary trading activity.
The court was keen to avoid a restrictive meaning of 'goods' which would exclude a large number of types of property that are now used in everyday trade and financing. Both lenders and office-holders should note that this judgment extends the definition of 'consideration' and may lead to more charges being held valid as against companies in liquidation and administration.
To discuss the issues raised in this article in more detail, please contact a member of our Restructuring and Insolvency team.
8. December 2022
von Lorna Bramich
8. December 2022
von Ralf van der Pas
6. December 2022
Wählen Sie aus unserem Angebot Ihre Interessen aus!Jetzt abonnieren
von mehreren Autoren
von Louise Jennings und Isabelle Moisy
von Louise Jennings und Callum Chamberlain