Royal Court of Jersey recognises ‘debtor in possession’ bankruptcy orders of the Canadian court over Jersey company for the first time (In the matter of the representation of Lydian International Limited)

Royal Court of Jersey recognises ‘debtor in possession’ bankruptcy orders of the Canadian court over Jersey company for the first time (In the matter of the representation of Lydian International Limited)

In a recent decision of the Royal Court of Jersey, Mourant Ozannes successfully obtained orders of the Royal Court recognising ‘debtor in possession’ bankruptcy orders of the Ontario Superior Court of Justice (‘the Canadian court’), relating to Lydian International Limited, a Jersey company. It is the first time that such Canadian proceedings have been recognised in Jersey. The judgment of the Royal Court establishes precedent for recognition of Canadian insolvency proceedings in Jersey, represents a development to the customary law principles of comity and reciprocity in Jersey, and contains informative analysis as to the factors that the court will balance when deciding whether to exercise its jurisdiction to assist foreign courts in insolvency matters. Written by Stephen Alexander, partner, and Max Galt, associate, at Mourant Ozannes in Jersey. 

In the matter of the representation of Lydian International Limited [2020] JRC049

What are the practical implications of this case? 

This welcome decision shows the willingness of the Royal Court to take a pragmatic approach when it comes to assisting foreign courts with complicated international insolvencies. It shows that the Jersey court will recognise foreign insolvency processes even where there is no equivalent process in Jersey, if it is appropriate to do so in the circumstances. Jersey retains a sophisticated and flexible judicial system which facilitates collaboration in cross-border insolvencies, and this decision adds to its prominence as an important international insolvency centre. 

What was the background? 

Lydian International is a Jersey company and the ultimate holding company for the wider Lydian Group. The Lydian Group is a complex, integrated, international structure. Its business is focused on the construction of its wholly owned development-stage gold mine in Armenia. Due to (allegations of) unlawful conduct of the government of Armenia relating to the development of the mine, the Lydian Group faces catastrophic financial difficulties. 

Lydian International, along with certain other entities within the Lydian Group, ap

Subscription Form

Latest Articles:

Already a subscriber? Login
RELX (UK) Limited, trading as LexisNexis, and our LexisNexis Legal & Professional group companies will contact you to confirm your email address. You can manage your communication preferences via our Preference Centre. You can learn more about how we handle your personal data and your rights by reviewing our  Privacy Policy.

Access this article and thousands of others like it free by subscribing to our blog.

Read full article

Already a subscriber? Login

About the author:

Zahra started working as a paralegal at Lexis Nexis in Banking and Insolvency teams in April 2019. Zahra graduated with a 2.1 honours in a BA French and Spanish, completed the GDL at BPP University and is seeking some experience before commencing the LPC. She has undertaken voluntary work for law firms in London, Argentina and Colombia.