Fair Game — administration rents and creditors’ returns
In recent years, some high-profile (and controversial) court decisions have swelled the list of liabilities that must be paid as expenses of an administration. Administration expenses enjoy ‘super priority’, being payable out of floating charge realisations ahead of the claims of preferential creditors and floating charge holders. So when an otherwise unsecured claim ranks as an administration expense, it clearly benefits the relevant creditor, but at the expense of the floating charge holder. It can also consume valuable resources that could otherwise be available to trade an ailing business.
Recently, though, the tide has been turning. In July last year, the Supreme Court held that financial support directions, or contribution notices, issued to a company by the Pensions Regulator will rank as a ‘provable debt’ of a company, and not as an expense of the administration.
Now, in the context of the administration of the Game group of companies, the Court of Appeal has revisited the rules on payment of rent as an administration expense. It has ruled that administrators should pay rent as an administration expense pro rata for the period that they use a property for the benefit of the administration. This is regardless of when the relevant rent payment day falls or whether the rent is payable in arrears or in advance…
Click on the link below to read the rest of the Dentons briefing.
News from Dentons
News from The Lawyer
Briefings from Dentons
The Ontario government says that it is acting on the early results of the Mining Sector Health, Safety and Prevention Review.
‘Inversion’ transactions are nothing new, and the current proceedings appear to be just another replay of earlier games of tag between the government and US multinationals.
Analysis from The Lawyer
The continent’s boom in natural resources and renewable energy is sparking an infrastructure drive
Shearman & Sterling is making its presence felt in the City, squaring up to magic circle firms and looking to muscle in on key relationships. Private equity house Bridgepoint is one outfit that has had its head turned by the US firm.