OFX ACTS IN SUCCESSFUL CHALLENGE TO MONSOON CVA
O’Flynn Exhams represented the Cork landlords in successfully establishing that a CVA (an English restructuring mechanism advanced by the tenant, Monsoon Accessorize Limited (MAL)) did not validly modify Irish commercial lease terms, and did not displace the contractual obligations of an Irish guarantor.
The Judgment of Mr Justice McDonald sets out salutary analysis on the challenging interaction between the relevant provisions of the European Insolvency Regulation (Recast), Irish law and the laws of England and Wales in this context.
While CVAs are currently recognised in this jurisdiction, the MAL CVA failed to apply the required rules and procedures having regard to Irish law. It followed that public policy considerations precluded recognition of the purported modification of Irish leases in the CVA.
Monsoon Accessorise Ireland Limited (MAIL) was not party to the CVA and had given robust guarantees and indemnities as primary obligor. MAIL’s arguments that its obligations were compromised by the CVA, did not succeed.
For more, see the following link to an Irish Times article on the Judgment:
The legal issues in the lengthy Judgment go beyond the scope of this brief note. For further detail, please contact Tom O’Byrne (tob@ofx.ie).