MF Global UK Ltd, Re Investment Bank Special Administration Regulations 2011

MF Global UK Ltd, Re Investment Bank Special Administration Regulations 2011

The CMP Trustee and administrators have the statutory power to compromise the claims between the client money pool and the general estate. The proposed settlement is a proper exercise of their discretion, is in the best interests of beneficiaries and creditors, and no objections have been raised. The court grants liberty to enter into the settlement.

Parties
Applicant/trustee of the Client Money Trust and General Estate: MF Global UK Limited (in special administration)
Jurisdiction
England and Wales
Judgment Date
04 July 2014
Procedural Posture
Application in Insolvency Proceedings / Approval of Settlement Agreement
Outcome
Application granted; liberty to enter into the proposed settlement agreement given to the CMP Trustee and administrators.
Legal Topics
Compromise of Claims, Client Money Trust, Administrator Powers, Distribution of Assets, Statutory Trusts
Insolvency Law Trust Law Financial Regulation Compromise of Claims Client Money Trust Administrator Powers Distribution of Assets Statutory Trusts

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Parties

MF Global UK Limited (in special administration)

Applicant/trustee of the Client Money Trust and General Estate

Procedural Posture

Application in Insolvency Proceedings / Approval of Settlement Agreement

Legal Issues

  1. 1 Whether the CMP Trustee and administrators have power to compromise claims between the client money pool and the general estate
  2. 2 Whether the proposed settlement is in the best interests of beneficiaries and creditors
  3. 3 Whether the court should approve or give liberty to enter into the settlement

Ratio Decidendi

The CMP Trustee and administrators have the statutory power to compromise the claims between the client money pool and the general estate. The proposed settlement is a proper exercise of their discretion, is in the best interests of beneficiaries and creditors, and no objections have been raised. The court grants liberty to enter into the settlement.

Court Disposition

Application granted; liberty to enter into the proposed settlement agreement given to the CMP Trustee and administrators.

Orders

  • CMP Trustee and administrators given liberty to enter into the proposed settlement agreement.
  • Direction that MFGUK may disregard certain client money entitlements in final distribution per FCA direction.