0370 270 6000

already registered?

Please sign in with your existing account details.

need to register?

Register to access exclusive content, sign up to receive our updates and personalise your experience on brownejacobson.com.

Privacy statement - Terms and conditions

Forgotten your password?

super priority for pension liabilities – an end to the rescue culture?

14 January 2011

The High Court has given super priority to pensions liabilities in an application brought by the administrators of Lehman Brothers European division and Nortel Networks.

It held that, whilst a company’s obligations to contribute to the pension schemes of any associated companies under the Pensions Regulator’s moral hazard powers are not provable debts in the administration, they are, in fact, payable as expenses of the administration which would have super priority.

Coupled with case law in relation to rent being payable in certain circumstances as an expense of the administration, the attraction of the administration procedure is becoming increasingly eroded. Lenders will also be more reluctant to lend to groups with large pension deficits due to uncertainty as to whether their debts will be repaid.

related opinions


The new Part A1 moratorium was introduced partly in response to the Covid-19 pandemic and its impact on businesses. The moratorium is not intended to be used to simply delay the inevitable insolvency of a company, but rather to allow breathing space for that company to restructure and/or achieve an effective rescue.

View blog

Covid-19 insolvency measures extension

From 26 March 2021 the Corporate Insolvency and Governance Act 2020 (Coronavirus) (Extension of the Relevant Period) Regulations 2021 will come into force with the effect of extending several of the temporary measures brought in by the Corporate Insolvency and Governance Act 2020 (CIGA).

View blog

Updated National Crime Agency (NCA) guidance: Shoot for better quality suspicious activity reports (SARs)

The National Crime Agency (NCA) published an updated guidance note for anti-money laundering supervisors targeted at improving the quality of suspicious activity reports (SARs) to make the best possible use of SARs and to minimise unnecessary delays, particularly where a defence against money laundering (DAML) has been sought.

View blog

Directors who fail to prepare, should prepare to fail

Two recent judgments demonstrate the risk that directors (of insolvent companies) face of being personally liable if appropriate records and procedures are not followed and if it cannot be shown that certain payments were in the interests of the company.

View blog

mailing list sign up

Select which mailings you would like to receive from us.

Sign up