Interest swap counterparties withheld payments due to Lehman Brothers International (Europe) in reliance on a provision of an ISDA Master Agreement that a party’s payment obligations were subject to the condition precedent that there was no continuing Event of Default with respect to the other party.
Held: As to whether the anti-deprivation principle applied, the authorities justified a distinction between (a) cases where the asset of the insolvent company was a chose in action representing the quid pro quo for something already done, sold or delivered before the onset of insolvency; and (b) cases where the right in question consists of the quid pro quo (in whole or in part) for services yet to be to be rendered or something still to be supplied by the insolvent company in an ongoing contract. In the former situation the court would more readily hold that the anti-deprivation rule applied.
Briggs J
[2010] EWHC 3372 (Ch), [2011] BPIR 788, [2011] 2 BCLC 120
Bailii
England and Wales
Cited by:
Cited – Belmont Park Investments Pty Ltd v BNY Corporate Trustee Services Ltd and Another SC 27-Jul-2011
Complex financial instruments insured the indebtedness of Lehman Brothers. On that company’s insolvency a claim was made. It was said that provisions in the documents offended the rule against the anti-deprivation rule. The courts below had upheld . .
Cited – Pioneer Freight Futures Company Ltd v TMT Asia Ltd ComC 21-Jul-2011
. .
Cited – Pioneer Freight Futures Company Ltd v TMT Asia Ltd ComC 1-Apr-2011
. .
Lists of cited by and citing cases may be incomplete.
Contract, Insolvency
Updated: 09 November 2021; Ref: scu.427405
