In the courts

Creditors can overturn the effect of matrimonial property agreements
A recent case confirms that matrimonial property agreements designed to defeat creditors may have little effect against those creditors.

Does a debenture holder owe a duty of care to unsecured creditors?
The High Court has considered the nature of the duty of care, if any, owed by debenture holders to unsecured creditors.

Both account holders liable where only one drew amounts in excess of the overdraft limit
The English Court of Appeal has decided that, where a joint bank account exists, an agreed overdraft limit does not expressly oblige the bank to decline any further borrowings by one account holder without reference to the other.

What does "bank or other financial institution" mean for an assignment clause?
A corporation in the business of buying and selling financial services did not fall within the description of "banks or other financial institutions" for the purposes of the assignment provision of a loan facility agreement.

Notice of intention to sell only required for mortgagor, not borrower
The protection given to mortgagors by section 90 of the Property Law Act 1952 does not apply to a borrower that did not give security over its property.

When is a transaction not in the ordinary course of business?
The High Court at Hamilton decided that because the relevant payment was only made by the company in response to the abnormal financial difficulties it found itself in, it was voidable on application of the liquidator and was ordered to be returned.

Enquiries and information

For more information on any of the cases, articles and features in Financial Services Quarterly, please email Rachel Gowing or call on 64 9 916 8825.