17 October 2011
The Court of Appeal has ruled bankrupt companies must fill their
pension gaps before paying other unsecured debts, upholding an
earlier ruling against the administrators for Lehman Brothers and
Nortel Networks.
The court upheld a High Court ruling last year that pension
funds were an expense and must be paid before debts to
administrators. The ruling prompted warnings it could hit the
chances of business rescues, though experts said the judgment would
only apply in specific circumstances, where the Pension Regulator
is involved.
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