In an important decision for insolvency practitioners handed down today, the BVI Court has confirmed the validity of the appointment of John Greenwood and Hadley Chilton of Baker Tilly (BVI) Limited as liquidators of four hedge funds incorporated in the BVI, and decided that a US Receiver attempting to claim assets owned by the hedge funds would not be recognised by the BVI Court.
Baker Tilly are represented in the BVI by Withers’ BVI office.
Greenwood and Chilton were appointed voluntary liquidators of Anchor Hedge Fund Limited, and three associated hedge funds, with effect from 24 October 2012, by their former investment adviser, Nikolai Battoo. Mr Battoo is the subject of proceedings in the US by both the US Commodity Futures Trading Commission and the Securities and Exchange Commission. The Illinois Court appointed Brick Kane, of Robb Evans & Associates Limited, as receiver to take control of all assets directly or indirectly owned by Mr Battoo and others. The US Receiver challenged the validity of the liquidators’ appointment, as well as seizing assets in the US and attempting to claim significant assets in Guernsey owned by the Funds.
In a judgment delivered on Wednesday 20 March 2013, Bannister J held that the liquidators had been validly appointed, holding, inter alia, that Mr Battoo as ultimate sole shareholder of the hedge funds had authority to appoint liquidators whether authorised by the funds’ immediate shareholders or not. Bannister J also held that the US Receiver was not entitled to recognition under Part XIX of the BVI Insolvency Act, and dismissed the US Receiver’s cross-application with costs.
Mr Lloyd Tamlyn, of South Square Chambers, London, acted for the liquidators, instructed by Niki Olympitis, Sara-Jane Knock & Sharada Shaw of Withers BVI. The liquidators are represented in the United States by Alston & Bird LLP and in Guernsey by Carey Olsen.