Vol 3 (2006) - Issue 3

Article preview

Remission Abroad of Assets Realised in English Insolvencies: Re: HIH Casualty And General Insurance Limited

Introduction
The English High Court has recently delivered two important decisions on the extent to which assets realised in English insolvencies can be ordered to be remitted abroad. The first in time was the decision of David Richards J in Re HIH Casualty and General Insurance Limited [2005] EWHC 2125 (Ch), which was applied shortly afterwards by Lewison J in Daewoo Motor Co Limited v Stormglaze UK Limited [2005] EWHC 2799 (Ch).

The HIH Decision

Background

The HIH Group comprised 274 companies which carried on business in many countries, including Australia and England. The group ran into serious difficulties in early 2001, and the boards of 17 key companies which were incorporated in Australia applied to the Supreme Court of New South Wales on 15 March 2001 for winding up orders, and the immediate appointment of provisional liquidators (who were later confirmed as liquidators).
The applications before David Richards J concerned 4 of these 17 companies, in respect of each of which letters of request had been issued by the Australian court to the English court pursuant to s. 426 of the English Insolvency Act 1986 for the appointment of provisional liquidators. Initially the English provisional liquidators simply owed their position to the letters of request. However, in July 2001, the English court granted a creditor of each of the companies permission to present winding-up petitions: the previous appointment of the provisional liquidators under s. 426 was discharged, and the provisional liquidators were reappointed pursuant to s. 135 of the Insolvency Act 1986 (which allows the appointment of provisional liquidators ‘at any time after the presentation of a winding-up petition’). Permission was granted for the presentation of the winding-up petitions because it was anticipated that there would be issues as to the proper interrelationship of the English and Australian insolvency regimes. These anticipated issues eventually came before David Richards J in this case.