BVI Case Law Updates

Luke Almond et al v Linxens Holding SAS

22 May 2026 – by Nina Roheman

BVI Court examines the doctrine of ‘unfair preference’.

Luke Almond et al v Linxens Holding SAS concerned an application by joint liquidators under sections 245 and 249 of the Insolvency Act, for the payment of US$125.9 million by Linxens to be deemed an unfair preference.

Under s. 245, a transaction entered into between a company and a creditor is an unfair preference if four requirements are met, namely, the transaction:

a.  is entered into when the company is insolvent or it causes the company to become insolvent;

b.  is entered into within the vulnerability period;

c.  has the effect of putting the creditor in a better position than it would have been in, in the insolvent liquidation; and

d.  did not take place in the ordinary course of business.

Section 245(4) creates a presumption of unfair preference where the creditor in question is a ‘connected person’ as defined by s. 5 of the Insolvency Act.

In this case, the question for the Court was whether a loan repayment by a BVI insolvent company (TUI) to a related company within the Group (Linxens) which was a connected person within the definition of s. 5, was an unfair preference.

Two key factual matters were examined:

• On 9 December 2020, TUI had announced on a stock exchange that it would be unable to make a final payment of interest and principal due the following day under bonds issued to Citicorp (i.e. that it was cash flow insolvent).
• Yet, two days prior on 7 December 2020, TUI had made a partial loan repayment to Linxens, in circumstances where that loan was not due for repayment until some 9 months later, nor had repayment been demanded[NR1] .

The liquidators argued that the payment to Linxens was an unfair preference in favour of Linxens.

The two issues for determination were whether TUI was cashflow insolvent when it paid Linxens and whether the payment was in the ordinary course of business.

In relation to the first issue, the Court accepted that the Court is entitled to find that the 245(4) presumption is not displaced if:

a.  The judge is not in a position to make a finding of solvency; or

b.  The judge is not in a position to make one or more findings about the ‘building blocks’ (i.e the necessary elements) in the case that the company was solvent.

On this first issue, the case underscores the importance of credible expert evidence on the issue of cashflow solvency and highlights that displacement of the presumption is fact specific. While not a box ticking exercise, if the necessary ‘building blocks’ are missing, the Court can generally adopt the position that the presumption has not been displaced.

On the second issue the Court confirmed that the question of whether a transaction is in the ordinary course of business cannot be divorced from the insolvency context within which the enquiry takes place. The Court’s enquiry examines whether the transaction was designed to confer an unfair preference.

On this issue, the case highlights the importance of looking at the effect of the transaction and the surrounding circumstances to objectively determine the intention behind it.

The full decision can be found here: Luke Almond et al v Linxens Holding SAS

Tetiana Ieremeieva et al v Estera Corporate Services (BVI) Limited

13 May 2026 – by Olena Golovtchouk

BVI Court of Appeal examines the doctrine of trustee de son tort.

The recent BVI Court of Appeal case of Ieremeieva et al v Estera Corporate Services (BVI) Ltd  which examined the doctrine of trustee de son tort, has close connections to my home jurisdiction of Ukraine.

During my travels to Ukraine in recent years, I frequently enjoyed having coffee at the various WOG filling stations operated by the business called WOG Holding Ltd, a company in the corporate structure examined before the BVI Courts.

Court of Appeal Decision

Key points from the Court of Appeal’s decision included:

1. As a developing doctrine, the law relating to trustee de son tort is flexible (Citing Mitchell v Sheikh Mohamed Bin Issa Al Jaber (No 2) [2025] UKSC 43);
2. The issue of trustee de son tort was reasonably arguable and not suitable for strike out, which ought to be limited to plain and obvious cases where there is no point in having a trial;
3. Certain arguments relating to ex tunc effect failed on appeal;
4. As both parties to the appeal were successful in part, the result was costs neutral.

The Court of Appeal’s decision raises important questions about when a Court may impose a finding of trusteeship de son tort, and how the modern law following the UK Supreme Court’s decision in Mitchell v Al Jaber should be applied in the BVI.

The full decision of the Court of Appeal can be found here: Tetiana Ieremeieva et al v Estera Corporate Services (BVI) Limited

Lim Yew Cheng v Guanghua SS Holdings Limited and Lin Minghan

6 May 2026 – by Eltin Ryle

BVI Court of Appeal clarifies legal principles relating to (1) the introduction of fresh evidence on appeal, (2) making new legal arguments on appeal, and (3) obtaining a stay pending determination of foreign proceedings.

The decision in Lim Yew Cheng v Guanghua SS Holdings Limited and Lin Minghan was recently delivered by the Court of Appeal. Of particular note are the following legal points arising:

Firstly, the Court of Appeal reiterated the decision in Ladd v Marshall which established the following test for introduction of fresh evidence on appeal:

1. It must be shown that the evidence could not have been obtained with reasonable diligence for use at the trial;
2. The evidence must be such that, if given, it would probably have an important influence on the result of the case, though it need not be decisive; and
3. The evidence must be such as is presumably to be believed, or in other words, it must be apparently credible, though it need not be incontrovertible.

Secondly, the Court of Appeal (citing Win Business (Caofeidan) Ltd) held that to introduce a new legal point on appeal, permission is needed, and a cogent explanation must be given for its omission from arguments raised before the Court of first instance.  New points of pure law may be allowed if they don’t require additional evidence, but appellate courts are cautious, especially if further evidence would be needed or if insufficient notice to the other party would result in prejudice.

Thirdly, the Court of Appeal (citing Athena Capital) held that the test for a grant of a case management stay is whether it is in the interests of justice to grant a stay. The threshold is high and it is only in rare and compelling circumstances that it will be in the interests of justice to grant a stay on case management grounds to await the outcome of foreign proceedings.

A key takeaway for BVI practitioners is the importance of placing all available evidence and legal argument before the Court of First Instance: it may not be possible to raise fresh evidence and legal argument on appeal.

The full decision of the Court of Appeal can be found here: Lim Yew Cheng v Guanghua SS Holdings Limited and Lin Minghan

AS PNB Banka (in liquidation) v Hillsham Limited

27 April 2026 – by Nina Roheman

BVI Commercial Court rules that no registered agent is required where a company is restored and immediately placed into liquidation

In the judgment of AS PNB Banka (in liquidation) v Hillsham Limited, the BVI Court addresses the interplay between section 91(5) and section 218A(1)(a)(i) of the Business Companies Act (BCA) on the question of whether a registered agent is required where a company is restored to the Register of Companies and immediately placed into liquidation.

• In an exercise of statutory interpretation, the Court ruled that there was no requirement for a registered agent in the circumstances of the case. Some key points from the judgment are:
• To interpret the BCA as requiring the appointment of a registered agent – in circumstances where there would be no interim period of corporate activity as the liquidator would manage the company’s affairs – would be to require compliance of a condition which the legislation itself declares unnecessary (by section 91(5)).
• Section 218A BCA is framed in discretionary rather than mandatory terms in that the Court ‘may’ restore a company if satisfied of certain matters.
• It would be contrary to the BCA and the Insolvency Act to require an insolvent estate to incur registered agent costs merely as a formal and transitional precondition to entering into liquidation, where the statute declares no such appointment is required.
• To impose the registered agent requirement in those circumstances would be to render dissolution an obstacle to the exercise of creditor rights since restoration would be impossible in cases where corporate management has disappeared or is unwilling to cooperate to provide the necessary information for registered agents to consent to act.

Key take away and implications for BVI: A registered agent is not required where a company is restored and immediately placed into liquidation by the same order.

This is a welcomed BVI judgment for creditors who would otherwise be unable to restore a company into liquidation, where they possess little to no information about the company.

In many cases, a registered agent will decline to act for a company if the minimum information required by AML legislation concerning the company has not been received. It is often the case that an applicant may not have such information where the former directors or shareholder are unknown / cannot be found / contacted or are uncooperative. The judgment directly acknowledges this difficulty and the outcome addresses it.

Where, however, an applicant seeks only restoration (without a liquidation order) the requirement for a registered agent remains with the attendant difficulty in cases where the applicant possesses little to no information on the company.

The full decision can be found here: AS PNB Banka (in liquidation) v Hillsham Limited

Wang Wenwei v SPQR Limited Partnership

17 April 2026 – by Nina Roheman

BVI Court rules that it has no Jurisdiction to appoint provisional liquidators over a BVI Limited Partnership

In the recent judgment in Wang Wenwei v SPQR Limited Partnership, the BVI Commercial Court considered the novel issue of whether the Court has power to appoint provisional liquidators over a BVI Limited Partnership under the Limited Partnerships Act 2017.

The Court emphatically concluded that it had no such power – a provisional liquidator is a creature of statute and absent an express power in legislation, such as that contained in s. 170 of the Insolvency Act, the Court cannot appoint a provisional liquidator over a limited partnership.

The Court also noted that even if jurisdiction had been established, the threshold for the appointment of provisional liquidators had not been met in the case.

For the appointment of provisional liquidators, it must be established that

i) it is likely that liquidators will be appointed; and

ii) the appointment of provisional liquidators is necessary to maintain the value of assets owned or managed.

The Court noted that on the first requirement, a determination of the likelihood of the appointment of liquidators would require the Court to assess matters which were within the scope of an arbitration agreement and subject to extant arbitration. The Court declined to do so ‘even in a preliminary way’ and noted that such restraint was consistent with the BVI’s pro-arbitration policy. As to the second requirement, necessity was simply not made out.

This case serves as a reminder to BVI legal practitioners that the appointment of provisional liquidators is an intrusive and draconian remedy which will not be granted lightly. This case also emphasises the importance of the underlying factual matrix in support of any application to the Court.  Finally, it is a reminder of the respect accorded to arbitration agreements by the BVI Courts.

The full decision can be found here: Wang Wenwei v SPQR Limited Partnership Judgment