Restructuring & Insolvency analysis: This decision clarifies the interaction between the super-priority regime in paragraph 64A of Schedule B1 to the Insolvency Act 1986 (IA 1986) and the payment of administration expenses. The High Court held that protected moratorium creditors do not enjoy an absolute priority over properly incurred administration expenses, including litigation funding costs where these facilitate asset realisations. The judgment confirms that administrators may, where consistent with their statutory functions and the purpose of the administration, repay litigation funders from recoveries ahead of protected moratorium creditors. It provides welcome certainty for office-holders considering funded litigation to maximise recoveries for creditors. Produced in partnership with Matthew Moriarty of Enterprise Chambers.

Where a litigant enters into an agreement with a third party that the latter will fund the costs of the proceedings, the litigant is still deemed liable to pay its costs for the purposes of the indemnity principle (whereby a successful party is indemnified for its costs incurred in the litigation). The only means by which the indemnity principle is breached in this scenario is in the event of an express bargain with the third party that the litigant will in no circumstances ever be liable to pay costs. (Culkin v The Wirral Independent Appeals Panel)

Insolvent estate The estate of a deceased person is insolvent if, when all assets are realised, it will be insufficient to meet in full all the debts and other liabilities to which the estate is subject. An estate is not insolvent if debts and liabilities can be settled even if none of the legacies can be paid. If an estate is insolvent, the beneficiaries under the Will or those entitled under the intestacy rules will receive nothing, nor will all the creditors receive full payment. The personal representatives (PRs) must pay creditors in the prescribed order or they may incur personal liability for debts in a higher category that have not been paid. If there is any risk that the estate may prove to be insolvent, the PRs must observe the prescribed order for payment of any debts and liabilities. For a broader introduction to and further information on insolvent estates, including the test of insolvency and methods of administration, see Practice Note: Insolvent estates and bankrupt beneficiaries. The Law Society has issued guidance on the

Meaning of solvent The rules applicable to the payment of the deceased’s debts and funeral and testamentary expenses depend on whether the estate is solvent or insolvent. A solvent estate is one where the assets are sufficient to pay the funeral, testamentary and administration expenses, debts and liabilities in full. It is irrelevant whether or not legacies can be paid in full in terms of deciding whether or not an estate is solvent. If there is doubt as to whether an estate will turn out to be solvent or not, the personal representatives (PRs) should consider following the statutory order for the payment of debts in an insolvent estate as set out in Schedule 6 to the Insolvency Act 1986, which provides an order of priority for the settlement of the deceased’s debts and funeral and testamentary expenses. For information on the statutory order for payment of debts in an insolvent estate, see Practice Note: Payment of debts—insolvent estate. The rules for determining where debts and liabilities fall in a solvent estate are found in section 34

Construction analysis: The Technology and Construction Court held that payment of a deposit was not a condition precedent to exercising an option for the purchase and development of land. Further, the owners had waived the requirement for the developer to pay the deposit (or were estopped from insisting on such payment). Accordingly, the owners were in repudiatory breach by refusing to accept the exercise of the option, and were liable to the developer for loss of profit.

This Practice Note sets out the requirements of the SRA Accounts Rules (Accounts Rules) regarding payment of interest. Responsibility for compliance Your firm’s managers are jointly and severally responsible for compliance. A manager means a sole practitioner, member of an LLP, director of a company, partner in a partnership etc. The firm’s compliance officer for finance and administration (COFA) must take all reasonable steps to ensure the firm, its managers and employees comply with any obligations imposed upon them under the Accounts Rules. However, the COFA is not jointly and severally liable with the firm's managers for compliance. SRA requirements General obligation to pay interest You must account to clients or third parties for a fair sum of interest on any client money held by you on their behalf. You may by a written agreement come to a different arrangement with the client or the third party for whom the money is held but you must provide sufficient information to enable them to give informed consent. Interest on money held outside client account The

A: General information Date of review [Insert date] Person(s) conducting review [insert name] B: Review and findings Do you need to review the circumstances in which you pay interest—to ensure you account to clients or third parties for a fair sum of interest on any client money you hold on their behalf? ☐ Yes—ensure you set an action point at section C below☐ No Do you need to review how you calculate interest—to ensure you pay a fair sum over the whole period the money is held?(You should consider factors

Identification of beneficial interests The personal representatives (PRs) of an estate must identify: • the beneficiary or beneficiaries entitled to each particular legacy • what each beneficiary is entitled to receive, and • the time at which each legacy should be distributed Executor's year PRs have at least one year from the date of death before beneficiaries can call on them to distribute any part of the estate. Even after one year, the PRs may not yet be in a position to distribute the estate. Deciding to distribute Before deciding to commence distribution of legacies, PRs must consider if there is reason to delay distribution due to other aspects of the estate administration being incomplete or potential issues arising, such as: • outstanding tax liabilities • outstanding debts • unknown beneficiaries • rectification action in relation to the Will • family provision claim under the Inheritance (Provision for Family and Dependants) Act 1975 • variation or disclaimer, or • any other uncertainties regarding the estate Beneficiaries Duty to distribute PRs must distribute

Corporate Crime analysis: This case concerned the payment of prosecution costs out of central funds after a successful private prosecution. The court made helpful observations about the correct approach to applications made by private prosecutors for these costs. Applications will not be granted by the court ‘on the nod’ and need to be properly prepared. The court will decide whether to award costs and, based on the evidence, whether the amount claimed should be reduced. These decisions will depend on the facts of each case. Written by Neil Swift, partner, and Alistair Jones, associate, at Peters & Peters Solicitors LLP. Neil Swift is also a member of the PSL Corporate Crime Consulting Editorial Board.

Boilerplate provisions in public sector contracts This Practice Note looks at payment of subcontractor clauses in public sector contracts. For more information on what contracting authorities (and other interested parties) need to know when using boilerplate provisions in public sector agreements, see Practice Note: Boilerplate provisions in public sector agreements: general considerations. Public procurement reform As of 24 February 2025, the main provisions of the Procurement Act 2023 (PA 2023) are in force. Procurements begun on or after this date must be carried out under PA 2023. The existing public procurement rules (including the Public Contracts Regulations 2015 (PCR 2015) and Procurement Practice Notes (PPNs), Utilities Contracts Regulations 2016, Concession Contracts Regulations 2016, and Defence and Security Public Contracts Regulations 2011) and/or those governed by other statute(s) (such as health care procurements) continue to apply to procurements already commenced when the PA 2023 regime entered into force. Procurements starting after the entry into force of PA 2023 must be conducted by reference to PA 2023 only. Procurements commenced under the previous

THIS PRACTICE NOTE APPLIES ONLY TO DEFINED BENEFIT AND HYBRID OCCUPATIONAL PENSION SCHEMES Payments to employers from trust schemes that are defined benefit schemes or earmarked schemes are highly regulated. Trust schemes are defined as any occupational pension scheme established under a trust. Employers for these purposes are the employers of persons in the description of employment to which the scheme in question relates. Defined benefit scheme funding levels in the UK began to improve significantly from around late 2022. As a result, there has been an increased interest in scheme funding surplus and the potential release of those surpluses. In April 2025, the Pensions Regulator (TPR) stated that it is good practice for trustees to have in place a policy for the release of surplus in the context of their individual scheme, and they may wish to start thinking about how they would approach any requests to release surpluses from the employer. For further information, see: TPR expectations while waiting for the relaxation of the surplus extraction requirements,

THIS PRACTICE NOTE APPLIES ONLY TO DEFINED BENEFIT AND HYBRID OCCUPATIONAL PENSION SCHEMES This Practice Note covers the considerations relevant to trustees and employers before deciding whether to pay a surplus in an occupational pension scheme to the employer (ie an authorised surplus payment) on a scheme wind-up, together with the requirements to satisfy when making such a payment under section 76 of the Pensions Act 1995 (PA 1995). There is a separate statutory regime under the Pensions Act 2004, s 251 and PA 1995, s 37 for the payment of surplus to the employer where a scheme is ongoing. For further information, see Practice Note: Payment of surplus to the employer—ongoing pension schemes. However, this Practice Note includes a summary of proposed new legislation regarding payment of surplus for ongoing schemes. Surplus to be paid as an authorised payment A payment to the sponsoring employer(s) of a pension scheme must be an authorised employer payment for the purposes of section 175 of the Finance Act 2004 (FA 2004). The list of