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While local schools, some businesses and many professionals have been on a lengthy summer hiatus, the same cannot be said for the local judiciary. The Grand Court of the Cayman Islands has continued to hear and determine a wide range of matters, many of which are of particular significance to the local financial services industry. The directions and judicial guidance flowing from the courthouse pays heed to the court’s overriding objective – which is to deal with cases in a just, expeditious, and economical way – and the court has delivered important new guidance by way of practice directions and judgments about the proper conduct not only of proceedings before it, but of industry professionals generally.
As those in the financial services industry well know, the filing of winding up petitions can be a contentious process, given the risk that petitions may be presented to the court improperly and the fact of their filing subsequently widely published (usually online, to great fanfare). In order to more clearly prescribe what is expected by the court at the time of filing such proceedings, the Grand Court has recently released Practice Direction No. 4 of 2017.
Noting that “the filing of a petition to wind up a company if publicized can cause irreparable harm to its reputation, even if the petition is ultimately dismissed for lack of merit,” the Practice Direction requires that, prior to filing any winding up petition, the petitioner’s attorney must apply in writing to the Grand Court Financial Services Division’s registrar to have the proceeding assigned to a judge and to fix a hearing date. A creditor’s petition must not be filed or entered upon the Register of Writs and Actions unless and until these matters have been attended to and, if the assigned judge makes an order restricting the filing or publication of the petition, it may not be entered on the register until further order of the court. Similarly, a contributory’s petition must not be published on the register until the judge has fixed a date for hearing the summons or as otherwise directed by the judge, and a winding up petition presented by the Cayman Islands Monetary Authority must be only be published on the register if the judge has so directed.
This article was first published in Cayman Financial Review.