Determining Courts' jurisdiction to sanction schemes of arrangement involving third party releases: A policy analysis

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Qu, Charles Zhen. 2024. "Determining Courts' jurisdiction to sanction schemes of arrangement involving third party releases: A policy analysis." Singapore Journal of Legal Studies. 2024, pp. 107-125.
Article Title

Determining Courts' jurisdiction to sanction schemes of arrangement involving third party releases: A policy analysis

ERA Journal ID17406
Article CategoryArticle
AuthorsQu, Charles Zhen
Journal TitleSingapore Journal of Legal Studies
Journal Citation2024, pp. 107-125
Number of Pages19
Year2024
PublisherNational University of Singapore
Place of PublicationSingapore
ISSN0218-2173
3029-1216
Web Address (URL)https://law.nus.edu.sg/sjls/wp-content/uploads/sites/14/2024/07/sjls-mar-24-107-1.pdf
AbstractIt is often necessary for a company to reach a compromise with its creditors, and where necessary, third parties. A useful tool for facilitating such a compromise is the scheme of arrangement, a court-controlled procedure for restructuring the relationship between the company and its members or creditors. The scheme provisions are, however, silent on whether a third-party release may be incorporated into a scheme. Since the mid 2000s, the Australian and UK courts have developed two different tests, namely the nexus test and the necessity test, to fill this statutory gap. This paper discusses policy concerns, if any, that the alternative tests have given cause to, and if the answer is 'yes', how these concerns should be addressed. The paper concludes that the necessity test does, and the nexus test does not, give cause for concern and that the latter should be adopted for determining scheme jurisdiction in all cases.
Contains Sensitive ContentDoes not contain sensitive content
ANZSRC Field of Research 2020480504. Legal institutions (incl. courts and justice systems)
Byline AffiliationsCharles Darwin University
School of Law and Justice
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