Contentious insolvency

Our team have extensive experience with insolvency– both corporate and personal. We have acted for and against officeholders (including receivers, administrators and liquidators of private, public and listed companies), financial institutions, creditors, shareholders and directors including in respect of administrations, IVAs and CVAs, liquidations and other contentious insolvency disputes.

Insolvency is often a feature of our cases, not least in cases of fraud, dishonesty and asset recovery. Our expertise includes high-value claims for wrongful trading, fraudulent trading, misfeasance, transactions at an undervalue and preferences payments. We also have experience gathering information and documents under officeholders’ powers, appointing provisional liquidators and making claims under section 423 of the Insolvency Act 1986. Our experience also includes having acted on matters relating to the financial sector, including for distressed hedge funds and the investors, directors (including with respect to directors’ disqualification) and investment managers of such funds.

Our lawyers have experience of dealing with statutory demands, petitions (including injunctions to restrain the presentation of winding up petitions) and other insolvency related claims and hearings from both the creditor and debtor side. We also have experience with the enforcement of securities and asset recovery.

Examples of recent insolvency-related matters on which our team has worked on include:

• Re Infund LLP: [2018] EWHC 1306 (Ch) – Proceedings ancillary to a US$2billion share dispute in Mexico. The English Court considered for the first time the meaning of certain statutory provisions applying to both companies and LLPs in the context of an administrative restoration. The Court determined that it had the power to reverse the restoration of an LLP in certain circumstances.
• Acting for two former directors of an insolvent English company that was part of a worldwide corporate group which manufactured and sold products sporting a globally recognised brand and household name. The company’s liquidators issued misfeasance proceedings seeking in excess of USD$240m from CYK’s clients and one other former director (who was separately represented). The case settled on confidential terms.
• Acting for the directors of a company in Administration further to allegations of breach of fiduciary duty and related applications under S.423 of the Insolvency Act 1986.
• Advising a former director of an insolvent English company in relation to various potential claims and the Liquidators’ conduct of the liquidation.
• Acting for former directors in wrongful/fraudulent trading claim worth c. £10m relating to the collapse of a derivative trading company.
• Acting for an insolvent Russian bank relating to a £1.34bn worldwide freezing order and search order in one of Russia’s largest ever alleged frauds (Vneshprombank v Bedzhamov).
• Securing the cross-border insolvency recognition of a Chilean insolvency practitioner of Alberto Chang Rajii, the so-called ‘Chilean Madoff’, in relation to an alleged US$100m+ Ponzi scheme, under the Cross Border Insolvency Regulations 2006.
• Acting for CIS state banks in liquidation seeking to recover assets from fraudulent acts of its former management.
• Acting for a Russian bank enforcing judgments of £150m+ in claims to set aside transactions under section 423 Insolvency Act 1986 (Bank of Moscow v Chernaykov).
• Advising liquidators of a company that appeared to have been used as the vehicle for a Ponzi scheme in Italy.
• Advising on a fraud, asset recovery and insolvency strategy for a group of creditors who invested £50m in a Ponzi scheme operated by a number of UK individuals who had purportedly invested the money in a Swiss regulated company.
• Acting for a Trustee in Bankruptcy in the largest fraudulent investment (Ponzi) scheme to hit Jamaica which involved obtaining a worldwide freezing order in Jamaica and a freezing order and Norwich Pharmacal order in the DIFC.
• In the matter of ESO Capital Luxembourg Holdings II S.a.r.l (FSD No: 77 of 2011-AJJ): acting in a €50m+ cross-border dispute arising out of the refinancing of a property construction and development project in the French West Indies, including defending injunction proceedings seeking to prevent the issue of a winding-up petition.

Our lawyers also have significant expertise and experience in advising on issues arising from cross-border insolvencies, including insolvencies in off-shore jurisdictions, such as Jersey, Guernsey, the Cayman Islands, the British Virgin Islands, Hong Kong and Singapore. We also have experience with claims for recognition under the Cross Border Insolvency Regulations 2006, which implements the UNCITRAL Model Law on Cross-Border Insolvency.

Our broad disputes resolution practice, including multi-jurisdictional asset recovery, misfeasance, fraud, and professional negligence disputes, gives us additional rounded expertise enabling us to deal with most contingencies that might arise in an insolvency context. We are instructed by officeholders to investigate wrongdoing and pursue wrongdoers. We also have close working relationships with some of the top ranked insolvency chambers and insolvency practitioners, and where appropriate, will instruct and work in conjunction with those specialists to ensure that clients get the best possible service and advice.