Vol 14 (2017) - Issue 6

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The Joint Administrators of Lehman Brothers Limited (Appellant) v Lehman Brothers International (Europe) (In Administration) and others (Respondents) [2017] UKSC 38

Lehman Brothers International (Europe) ('LBIE') was the UK subsidiary of Lehman Brothers Holdings Inc., the fourth largest investment bank in the United States, which filed for Chapter 11 bankruptcy protection on 15 September 2008. LBIE’s shares were held by two other group companies: LB Holdings Intermediate 2 Ltd ('LBHI2') and Lehman Brothers Ltd ('LBL'). Following the US parent’s collapse, LBIE and LBL were put into administration, also on 15 September 2008. LBHI2’s administration followed in January 2009. However, the English bank had never been balance sheet insolvent. Accordingly, the administrators of LBIE eventually found themselves charged with a surplus of around £7 billion – a highly unusual situation.