By James Croke, Jerry De Melo, partners in the Capital Markets group of Cadwalader, Wickersham & Taft; James Douglas, partner in the Financial Restructuring group; and Elisa Kerr, associate in the Capital Markets group
A recent test case in the Chancery Division has focused on the proper characterization of a charge over book debts (in American parlance, accounts receivables). On Jan.15, in his judgment rendered in the case of National Westminster Bank vs. Spectrum Plus Limited, the Vice-Chancellor has dealt with this issue in a manner consistent with the reasoning applied by the Judicial Committee of the Privy Council in Agnew and Bearsley vs. The Commissioner of Inland Revenue and Others, re Brumark Investments Limited, which had cast some doubt on the prevailing authority.