"A scheme of arrangement under Part 26 of the Companies Act 2006 required the arrangement to be made between the company and its creditors. Former clients of the company with proprietary interests held by the company in trust were not creditors, with the result that the court had no jurisdiction to sanction a scheme of arrangement which included those proprietary interests.
The Court of Appeal so held, dismissing an appeal by the administrators of Lehman Brothers International (Europe) against the decision of Mr Justice Blackburne ( EWHC 2141 (Ch)) that the court had no jurisdiction to sanction a scheme of arrangement proposed by the administrators between the company and former clients who had proprietary interests in the assets held by the company or on its behalf. The London Investment Banking Association opposed and GLG Partners LP supported the scheme..."
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