Re Sea Containers Ltd ((in Liquidation))

• Jurisdiction: Bermuda
• Judgment Date: 10 May 2012
• Date: 10 May 2012
• Docket Number: Commercial Jurisdiction 2006 No. 315
• Court: Supreme Court (Bermuda)

In The Supreme Court of Bermuda

Commercial Jurisdiction 2006 No. 315

In the matter of Sea Containers Ltd (in liquidation)

And in the matter of the Companies Act 1981

Ms S Hurrion for the Joint Provisional Liquidators

The following cases were referred to in the judgment:

Re ICO Global Communications (Holdings) LtdBDLR [1999] Bda LR 69

Masri v Consolidated Contractors International SAL et alBDLR [2010] Bda LR 21

Saad Investments Company Limited (in Caymanian Liquidation) v Greenway Special Opportunities Fund Ltd and Credit Agricole SuisseBDLR [2010] Bda LR 83

Abstract:

Appropriate forum - Liquidators to seek assistance from overseas courts

JUDGMENT of Kawaley CJ

Background

1. On October 16, 2006, I appointed Mr. Gareth Hughes and Mr. John McKenna (then of Ernst & Young England and Bermuda respectively) to be JPLs to monitor the restructuring of the Company under the management of its Board of Directors. The JPLs were empowered under paragraph 1 of that Order:

"(j) if necessary, to seek the assistance of the US Court and any other courts in which such proceedings are brought, as appropriate…"

2. On November 23, 2008, the Company and certain affiliates commenced Chapter 11 Proceedings in the United States Bankruptcy Court in Delaware. On January 9, 2009, Bell J modified the initial JPL appointment Order, replacing Mr. Gareth Hughes with Mr. Stephen Harris and limiting the JPLs' powers to those expressly set out in the Order. On January 21, 2010, Stephen Harris was replaced by Ms. Elizabeth Bingham of Ernst & Young in London, and she and Mr. McKenna are the current JPLs, continuing as such without seeking permanent appointment because of the nature of the restructuring process. By the January 21, 2010 Order, the Chief Justice broadened the JPLs' powers to include:

i. serving as Plan Administrators and "the oversight and management of the Company's interest in equalisation matters currently pending in the United Kingdom (paragraph 1(a)(ii));

ii. "all the powers contained in Section 175 of the Companies Act 1981" (paragraph 1(b)).

3. On January 22, 2010, the Company was wound-up by Ground CJ.

4. By Ex Parte Summons dated May 7, 2012, the JPLs sought the following substantive relief:

"1. a direction pursuant to section 176 (3) of the Companies Act 1981 sanctioning the JPLs application in The High Court of Justice, England & Wales, Chancery Division (the "English High Court") pursuant to sections 112 and 153 of the Insolvency Act 1986 substantially in accordance with the draft annexed hereto";

(2) an Order that a Letter of Request in the form annexed hereto be issued and directed to the English Court."

5. The Company is the parent of four UK companies in liquidation in the English High Court. It has an interest in certain assets held by a Bermuda Trust (the EREC Trust) to meet potential claims under a 1983 Group Pension Scheme which may be...