Scottish Lion — Another Blow To Solvent Schemes

Law360, New York (October 23, 2009, 1:06 PM EDT) -- The travesty that is the solvent scheme of arrangement has been dealt another blow — hopefully a fatal one. A month after issuing a blistering attack on the practice, Lord Glennie has entered final judgment refusing to sanction the Scottish Lion Insurance Co. scheme. It is worth taking a long look at Lord Glennie’s lengthy opinion.

The issue, succinctly stated by the court, was: “Can it ever be fair to sanction a ‘solvent’ scheme of arrangement in the face of continuing creditor opposition to having their...
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