- Winding up a company in an investment bank special administration (Re Beaufort Asset Clearing Services)
- What are the practical implications of this case?
- What was the background?
- What did the court decide?
- Case details
Restructuring & Insolvency analysis: The administrators of a company in an investment bank special administration petitioned for the winding up of the company and applied under paragraphs 79(3)(b) and 98(2)(c) of Schedule B1 to the Insolvency Act 1986 (IA 1986) for their appointments as administrators to cease to have effect and for their discharge from liability. They did so notwithstanding that the company continued to hold a small ‘rump’ of client assets and client money which it had not proved possible to return to clients during the administration, an outcome which was not expressly anticipated by the applicable legislative framework. The court held that it had jurisdiction to wind up a company in investment bank special administration, and that it was appropriate to exercise its discretion to wind up the company in the circumstances of the case. Two solvent nominee companies (each of which held assets on behalf of the company for the benefit of the company’s underlying clients) were wound up at the same time to enable the Official Receiver as liquidator to distribute any of the remaining client assets, should it become possible to do so in the future. Written by Rory Conway, partner, Jack Colthurst, managing associate, and Luke McCabe, associate, of Linklaters LLP, legal advisers to the administrators of the company.
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