A Summary Of Recent Developments In Insurance, Reinsurance And Litigation Law

Contents

In the Matter of Stanford International Bank Ltd An appeal from an order recognising Antiguan liquidators under the Cross Border Insolvency Regulations 2006 Webster & Ors v The Ridgeway Foundation School A case on indemnity costs involving arguments concerning ATE insurers Shell UK Ltd & Ors v Total UK Ltd & Ors A case on whether a beneficial owner of property can bring an action for negligent loss/damage to property This Week's Caselaw

In the Matter of Stanford International Bank Ltd

Appeal from order recognising Antiguan liquidators under the Cross Border Insolvency Regulations 2006

The first instance decision in this case was reported in Weekly Update 25/09. In the US, the US Securities Exchange Commission (SEC) obtained an order appointing a receiver over the worldwide assets of Stanford International Bank ("SIB") and other companies in the Stanford group. SIB was incorporated in Antigua. Two months later, an Antiguan court appointed two individuals as liquidators of SIB. Both the receiver and the liquidators applied in this case for recognition under the Cross Border Insolvency Regulations 2006 ("the Regulations"). The Regulations apply where assistance is sought in Great Britain by a foreign representative in connection with (inter alia) a "foreign main proceeding". A foreign proceeding is a "foreign main proceeding" if it takes place in a state where the debtor has the "centre of its main interests" ("COMI"). At first instance, Lewison J held that the powers and duties conferred on the receiver did not amount to a "foreign proceeding", but the liquidators were appointed to a law relating to insolvency and so were entitled to be recognised as foreign representatives of a foreign proceeding. As there were no factors to rebut the presumption that Antigua was the COMI of SIB, the liquidators were entitled to recognition as foreign representatives of a foreign main proceeding.

In this case, the Court of Appeal agreed with Lewison J's conclusions. The provisions relied on in the complaint filed by SEC in the US related to the protection of investors and could not be categorised as "a law relating to insolvency". As a result, the US receivership is not a "foreign proceeding". The Court of Appeal also agreed that the rebuttable presumption that Antigua was the COMI, as it is the country where the registered office of SIB is situated, had not in fact been rebutted.

Webster & Ors v The Ridgeway Foundation School

Indemnity costs and...