Grant & Ors v WDW 3 Investments Ltd & Anor

Grant & Ors v WDW 3 Investments Ltd & Anor

WDW qualifies as a 'financial institution' under the Facility Agreement, the assignment to WDW was valid, IBRC was entitled to terminate the swaps and demand the ETP despite its own bankruptcy Event of Default, and the ETP is secured by the Debenture notwithstanding assignment.

Parties
Applicants: Ryan Kevin Grant, Daniel Christopher Imison and Catherine Mary Williamson (Joint Administrators of Olympia Securities Commercial Plc (In Administration)); First Respondent: WDW 3 Investments Limited; Second Respondent: Arazim (Gibraltar) Limited
Jurisdiction
England and Wales
Judgment Date
23 November 2017
Procedural Posture
Insolvency Application for Directions / Judgment on Application for Directions Under Paragraph 63 of Schedule B1 of the Insolvency Act 1986
Outcome
Application for directions granted; issues resolved in favour of WDW and IBRC/MHB.
Legal Topics
Assignment of Contractual Rights, Secured Creditors, Interpretation of Financial Instruments, Early Termination of Swap Agreements
Insolvency Law Contract Law Banking and Finance Assignment of Contractual Rights Secured Creditors Interpretation of Financial Instruments Early Termination of Swap Agreements

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Parties

Ryan Kevin Grant, Daniel Christopher Imison and Catherine Mary Williamson (Joint Administrators of Olympia Securities Commercial Plc (In Administration))

Applicants

WDW 3 Investments Limited

First Respondent

Arazim (Gibraltar) Limited

Second Respondent

Procedural Posture

Insolvency Application for Directions / Judgment on Application for Directions Under Paragraph 63 of Schedule B1 of the Insolvency Act 1986

Legal Issues

  1. 1 Whether WDW is a 'financial institution' for the purposes of clause 23.2 of the Facility Agreement and thus a valid assignee
  2. 2 Whether IBRC was entitled to terminate the Swaps and demand payment of the Early Termination Payment (ETP) from the Company despite IBRC's own bankruptcy Event of Default
  3. 3 Whether the ETP is secured by the Debenture notwithstanding assignment

Ratio Decidendi

WDW qualifies as a 'financial institution' under the Facility Agreement, the assignment to WDW was valid, IBRC was entitled to terminate the swaps and demand the ETP despite its own bankruptcy Event of Default, and the ETP is secured by the Debenture notwithstanding assignment.

Court Disposition

Application for directions granted; issues resolved in favour of WDW and IBRC/MHB.

Orders

  • Declaration that WDW is a 'financial institution' for the purposes of clause 23.2 of the Facility Agreement and a valid assignee.
  • Declaration that IBRC was entitled to serve Notice of Early Termination and the Company is liable to pay the ETP.