The Hoffmann Chronicles: The Quest to Full Universalism
If Guan Siew (p.784) suggested in 2008 that the recent landmark cases of Cambridge Gas v Navigator Holdings [2007] and re HIH Casualty and General Insurance Ltd [2008] were “significant moves towards the goal of universalism,” then ostensibly the question begs, what impact has the July 2010 Court of Appeal case of Rubin & Lan v Eurofinance [2010] had on the increasingly borderless and neighbourly international insolvency landscape? More compelling, following the principle judgement from Ward LJ in the Court of Appeal, leave to appeal has been approved. Thus insolvency judges, practitioners, academics and regulators across the globe can eagerly await the ultimate judgement on the matter from the Supreme Court at some stage between late 2011 and early 2012. It remains to be seen whether we can expect the prevailing ethos of transnational judicial cooperation to continue and whether we can expect the Supreme Court judgement of 2011/2012 to build upon the ‘Hoffmann Chronicles’ (Cambridge Gas, HIH and Rubin) and to further the judicial and legislative quest towards full unmodified universalism?
This paper will consider the soft law international insolvency instruments that have been created to date as well as the advances in the common law thanks to the ‘Hoffmann Chronicles’. We will consider recent scholarly debate on the competing concepts of universalism and territorialism. However the main vein of analysis will consider the instrumental guiding hand of Lord Hoffmann et al. who in recent times have so fanatically fostered and cultivated the ideology of a centralised, single, once and for all universally applicable insolvency proceeding that seizes and distributes all assets. As Douglass G. Boshkoff (p.935) observed in 1994, “bankruptcy is no longer an arcane corner of the law,” and certainly entering into the year 2011 it has been pushed centre stage.
It is now at the forefront of legal policy discussion and rightly so due to the financial crisis of 2007-present. With the financial crisis and ever increasing globalisation, the established legislative frameworks and the recent common law responses to cross-border insolvencies stand as incredibly important developments for 21st Century international trade and commercial law. With monolithic public debts and near miss sovereign defaults the precedents established by the ‘Hoffmann Chronicles’ offer sterling optimism for the “tidal wave” (Wighton 2010) of insolvencies that we can expect in the future. With regards to the current corporate “death rate” David Wighton (2010) states clearly that “things are going to get worse before they get better.” Further common law advances will be welcomed to address the “tidal wave” of bankruptcies and this discussion will explore the possibility of further instalments to the ‘Hoffmann Chronicles’. It will now be necessary to paint a picture that elucidates the theoretical basis and the broader context of recent legislative and common law responses which have sought to address the deep-seated deficiencies of global insolvencies.
1. The patchwork quilt of insolvency regulations.
From the Montevideo Treaty on Commercial International Law of 1889 many sterile efforts have been made at international level in an attempt to produce a cross-border framework for bankruptcy administration. Despite the fact that international bankruptcy was for many years “disturbingly resistant to reform,” (Buxbaum 2000, p.23) various endeavours over the last decade have improved predictability and have had as their purpose the effective and efficient resolution of cross-border insolvencies. Before considering the multilateral initiatives created to date it is first necessary to consider the competing theories which have shaped the legislative endeavours and which define 21st Century bankruptcies.
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