Latest City Law News

05/08/2010 - Agreements procured under Duress: a case note

The liquidation of AKAI Holdings Ltd ("AKAI"), a multinational group of companies went down as one of the largest corporate insolvencies in Hong Kong history in late 1999. AKAI was a Bermudan company originally incorporated in Hong Kong and was listed on the Hong Kong Stock Exchange. In 2000, AKAI, which had a net asset deficiency of over US$1 billion was ordered to be wound up. Two of the Respondents Blossom Assets Ltd and Costner Holdings Ltd were shareholders of AKAI, and these two entities were controlled by the first Respondent Mr James Henry Ting, the Chairman and Chief Executive Officer of AKAI.
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15/07/2010 - Calls for reform of takeover laws

In light of the recent hostile takeover of the British household name Cadbury plc (Cadbury) by US Company Kraft Foods Inc (Kraft), the subject of hostile takeovers and how companies can fend an unwanted bidder off has become a much discussed topic of conversation. The hostile takeover of Cadbury has been widely publicised, especially the initial resistance by Cadbury shareholders to the takeover. Critics have argued that Kraft was able to string the takeover process out long enough so that Cadbury's shareholder register became filled with short-term investors, such as hedge funds, who would be willing to accept any bid to make a quick profit, with arguably no regard to the business's long term prospects or value. It has also raised a number of issues regarding the UK takeover regime generally. In the end, a sufficient percentage of Cadbury shareholders accepted the offer and "squeezed out" the remaining minority shareholders, allowing the takeover bid to complete.
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08/07/2010 - FSA takes two bites out of unauthorised deposit-takers

The High Court has recently reinforced the FSA's right to recoup losses suffered by investors in unauthorised firms, in addition to requiring such firms to disgorge all profits.
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08/07/2010 - Conflict of laws relating to 'legal capacity' and Restitution

A significant principle in relation to a party's capacity to enter into a contract was recently decided in the Court of Appeal. Specificially, the decision related to (1) the approach in interpreting the English conflicts rule relating to a corporation's capacity to enter into a contract, and (2) how English courts should deal with a public policy defence to a restitutionary claim based on a foreign statute.

Facts:

Depfa ACS Bank, an Irish bank (the "Bank") and two Norwegian local authorities (the "Authorities") entered into swap contracts which were governed by English law (the "Contracts"). The Bank was advised by Norwegian lawyers that the Authorities were not restricted under Section 50 of the Norwegian Local Government Act 1992 (the "Act") to enter into the Contracts, i.e. the Authorities had power and authority to enter into the same. The Act restricts the purposes for which the Authorities can enter into loan agreements.
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