A company had entered into a voluntary arrangement with its creditors, but subsequently went into liquidation. There was then a dispute as to the destination of sums held under the arrangement.
Held: Such arrangements created trusts. Whether that trust continued after formal insolvency was a matter of interpretation of the trust deed. Where money was expressly set aside to be paid to the creditors under the arrangement, that trust would normally continue beyond insolvency. If the deed made express provision for events on insolvency, that deed should be followed. The creditors under the voluntary arrangement could still prove in the bankruptcy for any balance of debt due to them after money secured under the deed.
Judges:
Lord Justice Peter Gibson, Lord Justice Ward and Lord Justice Dyson
Citations:
Times 11-Apr-2002, Gazette 10-May-2002
Jurisdiction:
England and Wales
Cited by:
Cited – Olympic Airlines Sa Pension and Life Assurance Scheme, The Trustees of The v Olympic Airlines Sa SC 29-Apr-2015
The airline was incorporated in Greece but with an office in the UK. It became insolvent leaving a deficit in the UK employee pension scheme. The trustees of the fund sought a secondary insolvency within the UK, and now a reference to the European . .
Lists of cited by and citing cases may be incomplete.
Insolvency, Company
Updated: 08 May 2022; Ref: scu.168565