Royal Scottish Assurance Plc, Re Confirmation of A Reduction of Capital [2011] ScotCS CSOH_2 (30 December 2010)

Royal Scottish Assurance Plc, Re Confirmation of A Reduction of Capital [2011] ScotCS CSOH_2 (30 December 2010)

There is no realistic possibility that any creditor could show a real likelihood that the reduction of capital would result in the company being unable to discharge its debts when due, given the company's financial position and regulatory safeguards. Therefore, the court confirms the reduction and dispenses with settling a list of creditors entitled to object.

Citation
[2011] ScotCS CSOH_2
Parties
Petitioner: Royal Scottish Assurance Plc
Jurisdiction
Scotland
Judgment Date
30 December 2010
Procedural Posture
Petition for Confirmation of Reduction of Capital / Final Hearing and Order
Outcome
petition granted
Legal Topics
Reduction of Share Capital, Creditor Protection, Regulatory Compliance, Life Assurance and Pension Policies
Company Law Insurance Law Reduction of Share Capital Creditor Protection Regulatory Compliance Life Assurance and Pension Policies

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Parties

Royal Scottish Assurance Plc

Petitioner

Procedural Posture

Petition for Confirmation of Reduction of Capital / Final Hearing and Order

Legal Issues

  1. 1 Whether the reduction of capital prejudices creditors under s.646(1)(b) Companies Act 2006
  2. 2 Whether the court should dispense with settling a list of creditors entitled to object
  3. 3 Adequacy of regulatory protections for long-term insurance policyholders

Ratio Decidendi

There is no realistic possibility that any creditor could show a real likelihood that the reduction of capital would result in the company being unable to discharge its debts when due, given the company's financial position and regulatory safeguards. Therefore, the court confirms the reduction and dispenses with settling a list of creditors entitled to object.

Court Disposition

petition granted

Orders

  • Order confirming reduction of capital by £90 million
  • Direction that s.646 Companies Act 2006 does not apply as regards creditors