A comparison of Mr Picard’s experiences in Cayman and the BVI

By Eliot Simpson

The decision earlier this year of Mr Justice Jones in the Financial Services Division of the Cayman Islands gave a broad interpretation of the assistance that may be available to a foreign insolvency representative at common law. This stands in rather stark contrast to the approach taken in the Commercial Court in the British Virgin Islands, where the common law basis for recognition was found to have little place in BVI law and where statutory assistance is available only to representatives from a limited number of jurisdictions.

In Irving H Picard and Bernard L Madoff Investment Securities LLC v Primeo Fund (14 January 2013, unreported), Mr Justice Jones ruled on a series of preliminary issues in an action brought by Mr Picard asserting a number of avoidance claims. Mr Picard is the trustee of Bernard L Madoff Investment Securities LLC (BLMIS). In a short judgment dated 5 February 2010 (2012 (1) CILR 231) Jones J had granted Mr Picard recognition under section 241(1) of the Companies Law (2009 Revision) as the sole person having the right to act on behalf of BLMIS in the Cayman Islands.

Thereafter, Mr Picard commenced the avoidance action (seeking to set aside payments made by BLMIS to Primeo Fund) claiming both under the Cayman Islands preference provision and under US insolvency law. The availability of these claims was considered (as preliminary issues) by Jones J in his 14 January 2013 judgment…

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