Recently in Insolvency Category

The Supreme Court yesterday commenced its hearing of a seven-year legal battle concerning the status in England and Wales of bankruptcy orders made abroad.

The law as it stands is that a bankruptcy order made abroad in the US, for example, is not enforceable in the UK unless there is a separate action brought in a UK court.

The Supreme Court is hearing the conjoined cases of Rubin v Eurofinance and New Cap Re.

Despite selling millions of records, going on many worldwide tours and topping international charts, four original members of the reggae band UB40 have been declared bankrupt.

Brian Travers, saxophone, Jimmy Brown, drums, Terence Oswald, trumpet and Norman Hassan, percussion, were declared bankrupt by a judge at Birmingham County Court last week, and have been listed by the Insolvency Service.

Robin Campbell, lead guitar and brother of the lead singer Ali, was also involved in the case but was not declared bankrupt.

A recent review of personal insolvency has led to the Minister for Employment Relations, Consumer and Postal Affairs to propose raising the threshold for debt for which creditors may petition for bankruptcy.

Currently for a debt of at least £750, a creditor may make their debtor bankrupt. This amount was set in the Insolvency Act 1986 and has not been amended since.

Mr Davey has proposed increasing this threshold to £3,000 since being able to "threaten someone with bankruptcy for such a small amount is disproportionate."

A debt management company, Parkgate UK Ltd., has had its licence revoked by the Office of Fair Trading after it sent a threatening letter to a debt collection agency.

Parkgate, representing a client who was in debt, warned the agency not to attempt to collect money from their client, threatening physical violence if they continued to do so.

As well as sending the threatening letter, Parkgate also failed to adhere to practices that a consumer credit business should, according to the OFT's guidelines.

Over 135,000 individuals were declared insolvent in the UK last year, up from 2009.

The Insolvency Service released figures this week showing a rise of 0.7 per cent in individuals applying for insolvency in England and Wales.

Financial experts KPMG are quoted on the Independent website estimating creditors are losing £20 million a day from UK insolvencies.

HMV, the last UK high street chain, received a boost this week after chiefs of several major record labels rallied round the under-pressure high-street retailer.

Those supporting the troubled chain include Ged Doherty of Sony Music UK, David Joseph, chairman of Universal Music UK and Christian Tattersfield, chief executive of Warner Music UK.

The news comes a day after it was revealed some of HMV's suppliers were having their credit insurance reduced due to low confidence over the HMV group's trading position.

UK pensioners are six times more likely to go bankrupt than ten years ago, says data released by the Insolvency Service.

People over 65-years-old are applying for bankruptcy at a 50 per cent higher rate than any other age group.

From 2000 to 2009 the percentage of women over 65 going bankrupt rose from 2 per cent to four percent.

Do you own property jointly with someone else -- your girlfriend/boyfriend, say, or your wife/husband or domestic partner? Are you concerned about what could happen to your interest in the property if you split up and your ex- is declared bankrupt? Read on...

Invariably when someone enters bankruptcy the only thing in their estate worth anything of real value is the home they live in.

In adjudicating the disposition of property in this instance, the courts have to balance two competing interests: (1) the interests of the bankrupt's ex- or still current living partner (who may wish to remain in the property); and (2) the bankrupt's creditors (who probably want the property sold to claw back the money they're owed).

Hundreds of call centre employees made redundant in the North East over the summer won claims for unfair dismissal at an employment tribunal in Newcastle yesterday.

1,158 staff working at Garlands call centres in South Shields, Middlesbrough and Hartlepool were laid off after the company called in administrators.

Around 300 of them say they are still owed three months wages because they were not given a 90-day consultation period before being laid off.

The real-life soap opera that is Liverpool Football Club swings back to Sue-Ellen and JR Ewing country today.

After another day of great drama at London's high court, Justice Floyd ordered the club's owners, Tom Hicks and George Gillett, to withdraw their Texas state court petition to facilitate the orderly sale of Liverpool FC to New England Sports Ventures (NESV).

He gave the duo until 4pm BST today to comply with the order or risk being charged with contempt of court -- a serious offence that can carry a prison sentence.

As already discussed in earlier posts today, the American owners of debt-ridden Liverpool FC, Tom Hicks and George Gillett, have won a temporary restraining order in Texas state court to block the sale of the club to New England Sports Ventures (NESV).

The news emerged at around 9pm UK time by way of a statement published on law firm Fish & Richardson's website. The statement is reproduced in full below:

'The owners of Liverpool Football Club today reported that a Texas State District Court has granted a temporary restraining order (TRO) enjoining the Board of Liverpool Football Club (LFC) from executing a sale of the Club to New England Sports Ventures (NESV). The court set a hearing date of October 25, 2010.

In a dramatic twist late last night, a state court in Texas granted the American owners of debt-ridden Liverpool Football Club, Tom Hicks and George Gillett, a temporary restraining order (TRO) to stop the £300m sale of the club to New England Sports Ventures (NESV), the owners of Boston Red Sox.

The TRO request, signed by Judge Jim Jordan of the 160th District Court in Dallas, was part of a lawsuit filed by Hicks and Gillett against Royal Bank of Scotland (RBS), NESV, Liverpool chairman Martin Broughton, managing director Christian Purslow, commercial director Ian Ayre, and financial director Philip Nash.

Many furious Liverpool fans have questioned the authority of an American court to block the sale. The fans fail to realise, however, that RBS, Broughton (in his role as chairman of British Airways), and NESV all have significant connections with Texas, which allows the state court to exercise personal jurisdiction over them. Any violation of the order could lead to criminal charges of contempt.

The Royal Bank of Scotland (RBS) won a high court case against the owners of Liverpool Football Club yesterday in London.

The owners of the debt-ridden club, Tom Hicks and George Gillett, tried to sack two board members and replace them with their own appointments to prevent the knockdown £300m sale of the club to Boston Red Sox owners New England Sports Ventures.

In so doing, High Court Justice Floyd ruled the pair had breached a refinancing arrangement agreed with RBS in April.

1,400 workers made redundant following the collapse of social-housing giant Connaught are reportedly considering legal action for unfair dismissal.

Many of the workers received no notice about potential redundancies before being laid off last Monday.

Early last week social-housing maintenance company Connaught called in administrators after government spending cuts pushed the firm into financial difficulties.

Connaught's demise led many to speculate on the future of thousands of social-housing homes left in limbo -- who would step in to perform the maintenance contracts?