Q&As

Can a shareholder challenge a company voluntary arrangement (CVA) under section 994 of the Companies Act 2006 in addition to under section 6 of the Insolvency Act 1986 (IA 1986)? Is there any case law on this and any case law specifically about shareholders challenging CVAs via the usual IA 1986 route?

read titleRead full title
Produced in partnership with Oberon Kwok of Selbourne Chambers
Published on LexisPSL on 12/06/2019

The following Restructuring & Insolvency Q&A produced in partnership with Oberon Kwok of Selbourne Chambers provides comprehensive and up to date legal information covering:

  • Can a shareholder challenge a company voluntary arrangement (CVA) under section 994 of the Companies Act 2006 in addition to under section 6 of the Insolvency Act 1986 (IA 1986)? Is there any case law on this and any case law specifically about shareholders challenging CVAs via the usual IA 1986 route?

Can a shareholder challenge a company voluntary arrangement (CVA) under section 994 of the Companies Act 2006 in addition to under section 6 of the Insolvency Act 1986 (IA 1986)? Is there any case law on this and any case law specifically about shareholders challenging CVAs via the usual IA 1986 route?

This response assumes that the putative challenge concerns interests held by the shareholder in their capacity as such, as opposed to any other interests they may also have (eg as a creditor of the company).

There does not appear to be any case law that address either of these points.

As to the first question, Part I—Company voluntary arrangements: Insolvency Legislation: Annotation and Commentary [1.2] appears to take the view that challenges under section 994 of the Companies Act 2006 (CA 2006) can exist, but as the context ‘unfairly prejudicial’ is employed in a very different context (ie relating to the conduct of the management of the company), the authorities on CA 2006, s 994 are unlikely to be of assistance in interpreting section 6 of the Insolvency Act 1986 (IA 1986).

Alternatively, an analogy might lie with Fulham Football Club (1987) Ltd v Richards, in which the Court of Appeal held that the right to bring a petition under CA 2006, s 994 could be, and was, displaced by an alternative dispute procedure set out

Related documents:

Popular documents