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(Chancery Division, Newey J, 12 July 2011)
The company had entered into administration and subsequently a CVA. Newey J refused to sanction payments proposed to be made to its parent company on the termination of the CVA because it would amount to an unlawful return of capital to a shareholder, even though the company's creditors, who had been fully paid under the CVA, could not be prejudiced.
"This is the ultimate statement of where the law on IVAs is to be found in our great common law...