First published in 2005 and last published in 2013, the fourth edition of the Insolvency Law Handbook - authored by Howard Kennedy partner Vernon Dennis - has now been published.
Published by The Law Society, the handbook provides a radical overhaul of the content, which is reflective of the huge number of changes to insolvency law and practice in that time.
This new edition is particularly pertinent as it was developed and then published, April 2021, during a period of great uncertainty for businesses. Covid-19 has acted as an accelerator of change in a huge number of social-economic areas and continues to have a profound effect upon business activity. The government responded by providing the greatest level of peacetime support ever seen, pumping the economy through government-backed loan schemes, grants and protecting employment through job retention schemes.
In addition to these macro-economic measures, in June 2020 emergency corporate insolvency legislation in the form of the Corporate Insolvency and Governance Act 2020 was introduced. This saw new permanent debtor led processes being introduced (i.e. the new style moratorium and restructuring plan), together with emergency legislation (i.e. the effective suspension of corporate statutory demands and winding up petitions, restrictions on landlords’ rights of forfeiture). Together these measures meant that a recessionary spiral, causing unprecedented insolvency levels, has for the time being at least been averted.
Howard Kennedy said it must however be noted that these emergency measures have now been in place for over 12 months. While preventing the self-interest of market economics causing an accelerated and unchecked form of financial Darwinism, preventing creditors from acting against bad businesses may have done no more than "kick the can along the road" building an unsustainable debt mountain. There is therefore great uncertainty as to whether the enormous public and private debt burden incurred as a result of the pandemic will eventually lead to huge rises in individual and corporates insolvency; the publication of the new edition is therefore timely.
The book is unusual, as uniquely the multitude of problems facing individuals and businesses are examined from the perspective of the debtor and then separately from the creditor point of view. What options are available, what key decisions are to be made, and what are the potential pitfalls of taking any particular action. For those who make the wrong choices, civil and even criminal liability may result.
In the field of financial distress and insolvency, consideration of the commercial imperatives and impact of any action, is equally as important as the need to ensure compliance with the legal and regulatory framework. The book makes clear through examples and step-by-step guidance, how regard to both the commercial realities and the legal obligations, is an essential requirement for professionals called upon to advise debtors faced with personal or corporate insolvency, or their creditors. The book is aimed as a handbook for such professionals.