Law Debenture Trust Corporation Plc v Concord Trust & Ors Rev 1

Law Debenture Trust Corporation Plc v Concord Trust & Ors Rev 1

Elektrim is not entitled to release of security or distribution of monies until all secured liabilities, including contingent liabilities and Trustee’s costs, are satisfied to the Trustee’s satisfaction. Redemption requires actual payment to bondholders, not merely to the Trustee. The Trustee is entitled to retain funds and security for indemnity, and interest continues to accrue until distribution. Elektrim’s claim regarding the PAK shares lacks merit as the shares never became security and possession is under a valid Polish court order.

Parties
Claimant: The Law Debenture Trust Corporation plc; Defendant: Concord Trust; Defendant: Acciona S.A.; Defendant: Elektrim S.A.; Defendant: Vivendi Holdings I Corp
Jurisdiction
England and Wales
Judgment Date
15 June 2007
Procedural Posture
Civil / Final Judgment
Outcome
Elektrim not entitled to release of security or distribution; Trustee entitled to retain €15,500,000 for indemnity; bondholders’ resolution validly passed; Elektrim remains liable for Trustee’s costs; interest continues to accrue.
Legal Topics
Trustee Indemnity, Bond Redemption, Security Release, Conversion, Distribution of Trust Funds, Interest Calculation, Contingent Liabilities
Trusts Contract Secured Transactions Banking and Finance Trustee Indemnity Bond Redemption Security Release Conversion +3 more

Case Brief

Summary, issues, holding and outcome

More case intelligence is available

Unlock the full research layer for this judgment.

Full judgment text Downloadable case file Legal principles 5 Authorities cited 8 Party arguments 2 Amounts and remedies 10
Sign in to unlock

Parties

The Law Debenture Trust Corporation plc

Claimant

Concord Trust

Defendant

Acciona S.A.

Defendant

Elektrim S.A.

Defendant

Vivendi Holdings I Corp

Defendant

Procedural Posture

Civil / Final Judgment

Legal Issues

  1. 1 Whether payment by Elektrim of €525 million constituted redemption of the bonds
  2. 2 Whether the Trustee is obliged to release security to Elektrim
  3. 3 Whether the Trustee is obliged to distribute monies to bondholders

Ratio Decidendi

Elektrim is not entitled to release of security or distribution of monies until all secured liabilities, including contingent liabilities and Trustee’s costs, are satisfied to the Trustee’s satisfaction. Redemption requires actual payment to bondholders, not merely to the Trustee. The Trustee is entitled to retain funds and security for indemnity, and interest continues to accrue until distribution. Elektrim’s claim regarding the PAK shares lacks merit as the shares never became security and possession is under a valid Polish court order.

Court Disposition

Elektrim not entitled to release of security or distribution; Trustee entitled to retain €15,500,000 for indemnity; bondholders’ resolution validly passed; Elektrim remains liable for Trustee’s costs; interest continues to accrue.

Orders

  • Trustee permitted to retain €15,500,000 out of the fund for indemnity against costs and contingent liabilities.
  • Elektrim not entitled to release of security or distribution of monies until all liabilities satisfied.