1. This article by Mr. V. Umakanth discusses put and call options in the context of securities regulation in India. From the abstract: “This article embarks on the modest task of mapping out the legal landscape that presently shapes the enforceability of put and call options in Indian companies. It seeks to review applicable legislation and analyze key judicial pronouncements that hold sway over the field. It finds that the current legal regime governing put and call options in investment agreements is fragmented and hazy and unnecessarily restricts the ability of investors in Indian companies to enter into such arrangements to protect their own interests. It calls for a reconsideration of the legal regime so that physically settled options that are customary in investment agreements may be treated as valid and legally enforceable…”
2. This post on the UKSC Blog discusses a recent decision of the UK Supreme Court, Belmont v BNY, where the Supreme Court has discussed the “anti-deprivation rule” in insolvency law. The rule is effectively that “There cannot be a valid contract that a man’s property shall remain his until bankruptcy, and on the happening of that event shall go over to someone else and be taken away from his creditors…” Ex p Jay; Re Harrison [1880] 14 Ch D 19. The Supreme Court has held that the rule applies only when there is a deliberate intention to evade insolvency laws, and does not hurt genuine commercial arrangements. Lord Mance’s judgment notes the background of the rules: “I am satisfied that there are, and ought to be, two principles in this area. One is the principle applied in British Eagle, which precludes a bankrupt from agreeing to distribute his, her or its property other than pari passu in bankruptcy (although it does not preclude creditors from agreeing inter se on the distribution inter se of their pari passu shares: In re Maxwell Communications Corpn plc [1993] 1 WLR 1402). The other is a concurrent principle, whereby dispositions of property on bankruptcy may be invalidated as being in fraud or an evasion of the bankruptcy laws… While the two principles are conceptually distinct, they are quite closely allied. British Eagle addresses what happens in bankruptcy. An anti-deprivation principle addresses what happens on bankruptcy. If contracting out of the statutory rule requiring pari passu distribution in bankruptcy is impermissible, it would be surprising if there were no concurrent principle capable of invalidating certain dispositions which, by removing property from the bankrupt on bankruptcy, had the same ultimate effect… “ He then laid down a three-fold test to apply in anti-deprivation cases: “The existence of a contractual scheme, which is said to create the relevant property interest, but at the same time to include provisions providing for its illegitimate deprivation on bankruptcy, raises several questions: First, how far did the scheme confer any property interest on the subsequently bankrupt party? Second, how far did it deprive him of any such property on bankruptcy? Third, in so far as it did deprive him of any such property on bankruptcy, did this amount to an illegitimate evasion of the anti-deprivation principle?”
3. In this post on Indian Corporate Law, I have discussed the judgment of the Bombay High Court in Retailers Association v Union of India, where the Court upheld the constitutional validity of service tax on renting of immovable property.
4. This post discusses a recent decision of the England & Wales High Court, where the Court held that members of an limited liability partnership do not as such owe fiduciary duties to one another.
5. This post on the Lex Arbitri blog discusses the historical development of arbitration law in India.
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