KFI 380/2019
This case involved the declaration of bankruptcy of a company which had had its restructuring agreement found void. aAkey point was whether the court of appeal's decision that the restructuring agreement was void meant executory acknowledgments of debt which were signed because of this agreement were also void.
Background
A company entered into a restructuring agreement with a bank in 2011 under Kuwait Law No. 2/2009 which was enacted to deal with the 2008 financial crisis.
In 2013, following multiple letters from the bank, the Court of Appeal voided the restructuring agreement citing implementation violations of the restructuring plan. The company tried to secure another restructuring agreement twice but without success.
In 2015, the President of the company's board of directors was found guilty of omitting and misrepresenting material information relating to the financial status of the company in its restructuring agreement application.
In this case, seven creditors of the company joined as plaintiffs to demand a declaration of bankruptcy of the company. The Court agreed.