The Finance Brief - 1 October 2012
We have a full edition this quarter, with articles on a range of subjects including an outline of the proposed changes to the registration of charges at Companies House and the issues a lender should consider when lending to a borrower which is incorporated or has substantial assets outside England and Wales. We also provide a guide for enforcing against personal guarantors and analyse the practical consequences of two recent cases, the first of which considers whether, as a private banker, you are able to witness deeds entered into by your clients, and the second of which looks at the legal status of agreements to negotiate in good faith.
Finally, as you may be aware, the Wheatley Review published its final report last Friday (28 September) on the structure and governance of LIBOR. Please also follow this link to read the recent article published by Fieldfisher which analyses the ongoing issues around LIBOR: The LIBOR scandal.
Hannah Salton, Editor
Proposed changes to the registration of charges with Companies House
In August 2012, the Department for Business, Innovation and Skills ("BIS") published draft regulations (the "Regulations") to amend the regime for registration of charges with Companies House. The purpose of the Regulations is to streamline and modernise the registration of charges created by companies and LLP's in the UK. The Regulations are expected to come into force on 6 April 2013, although some provisions remain subject to further consultation. Here we consider the proposed changes.
Key Issues to be aware of when enforcing against Personal Guarantors
The purpose of this briefing paper is to provide an overview of the process where a lender wishes to enforce a personal guarantee against an individual personal guarantor in respect of monies due to a lender, classically under a facility agreement.
Non-UK borrowers and issues of security, COMI, administrators and receivers
This article looks at some of the issues a lender should consider when a borrower or security provider is incorporated or has substantial assets outside England and Wales. The lender needs to know how this will affect its security and remedies, and the possible impact of insolvency procedures in relevant jurisdictions.
Can a private banker witness a customer's deed?
We are often asked who can witness a signature to a deed. A number of key documents employed by private banks take the form of deeds, such as collateral agreements, debentures and guarantees, so this is a key procedural issue for lenders. Specifically, the issue often arises whether an employee of the bank can witness a deed.
No faith in the enforceability of agreements to negotiate in good faith
It has long been a principle of English law that an agreement to agree will be unenforceable (Walford v Miles (1992)), however what has been less clear is whether an agreement to negotiate in good faith would be considered within this category or not.
The Finance Brief will be back in the new year, in which we will be considering the potential liability which a lender may have to third parties when it takes security over an asset (such as real estate or yachts). We will also provide an overview of enforcing judgments and arbitral awards in Russia and the consequential issues to consider when a lender is looking to take guarantees from a Russian individual.
We are very keen to hear your feedback on The Finance Brief – please do get in touch.