In 2013 the Companies (Miscellaneous Provisions) Act was enacted and provided for small companies to apply for examinership in the Circuit Court as well as the High Court. The intention of this Act was to reduce the cost of seeking examinership protection, albeit that the work required to be done by the parties involved remained exactly the same as in the High Court. In the following year, only 6 companies availed of examinership through the Circuit Court and the level of Circuit Court examinerships has remained low.
In two recent cases the High Court has appointed an Examiner to a company and then remitted the examinership to the Circuit Court in which the companies’ registered office at the time of presentation of the petition is located. The Companies Act, 2014 provides that a small company can apply for the appointment of an Examiner to either the High Court or to the Circuit Court in which it has its registered office or principal place of business.
A small company is one that satisfies any 2 of the following criteria;
(a) the amount of the turnover of the company is ≤ €8.8 million;
(b) the balance sheet total of the company is ≤ €4.4 million;
(c) the average number of employees of the company is ≤ 50.
In Re Rathmond Ireland Limited (Costello J, decision of 8 May 2017) the case was remitted to the Dublin Circuit Court.
In Re Com-Plas Packaging Limited and Scriptdale Limited (Haughton J, decision of 15 May 2017) the case was remitted to the Eastern Circuit as the companies’ registered offices are in Naas. The Circuit Court for the Eastern Circuit moves between counties and sits variously in Naas, Trim, Dundalk and Bray. Given that the notice parties and the respective legal teams in the case are all based in Dublin, having the matter remitted to the Circuit Court will undoubtedly lead to an increase in costs due to travel requirements.
For further information on this topic please contact Gavin Simons (Partner), or your usual AMOSS contact.