Footnotes (43)



Resolving the MS Fashions 'Paradox'

Riz Mokal

University College London (UCL) - Faculty of Laws; South Square Chambers

December 1998

In the context of the decision of the House of Lords in Re Bank of Credit and Commerce International S.A. (No. 8) [1998] AC 214, this short paper asks (i) whether the existence of a charge in one's favour over one's own indebtedness (a 'charge-back') destroys the mutuality necessary for insolvency set-off to operate, and (ii) whether the assets of the insolvent company are notionally collected before the set-off may operate. Both questions are answered in the negative. The paper concludes by suggesting that the reasons given by the courts in justifying the very existence of insolvency set-off also argue in favour of allowing it to operate in the appropriate case, even if there is a charge-back.

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Date posted: May 21, 2004  

Suggested Citation

Mokal, Riz, Resolving the MS Fashions 'Paradox' (December 1998). Available at SSRN: https://ssrn.com/abstract=548643 or http://dx.doi.org/10.2139/ssrn.548643

Contact Information

Riz Mokal (Contact Author)
University College London (UCL) - Faculty of Laws ( email )
Gower St
London WC1E OEG, WC1E 6BT
United Kingdom
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HOME PAGE: http://www.ucl.ac.uk/laws/
South Square Chambers ( email )
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London, WC1R 5HP
United Kingdom
HOME PAGE: http://www.southsquare.com/
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