In this Issue:-
Endeavours Obligations In the Matter of Cognotec Limited (In Receivership) ENDEAVOURS OBLIGATIONS
The terms "all reasonable endeavours", "reasonable endeavours" and "best endeavours" are regularly used in the drafting of commercial agreements and contracts. Despite this widespread use, the actual obligations imposed by each of these terms are unclear. Recent UK case law has provided further guidance on the obligations imposed by parties contracting to use "all reasonable endeavours".
Please see the Dillon Eustace publication entitled article "Endeavours Obligations" for further information on this matter.
IN THE MATTER OF COGNOTEC LIMITED (IN RECEIVERSHIP)
A recent High Court judgement in the above matter has provided clarification on whether transactions are voidable by companies under section 60 (14) of the Companies Act, 1963 in circumstances where the necessary statutory declaration under section 60 (2) has not been filed by a company within the statutorily prescribed time limit and the person seeking to rely and enforce the transaction is not actually aware of the company's default.
Section 60 (1) prohibits the giving by a company of financial assistance for the purpose of, or in connection with, the purchase of its own shares. Under section 60 (14), a transaction in breach of section 60 is voidable at the instance of the company against any person with notice of the facts which constitute the breach. The prohibition under section 60 (1) does not apply to financial assistance given by a company which has complied with the statutory conditions under section 60 (2) (generally known as the "whitewash procedure").
In the present case Barclays Bank Ireland plc ("the Bank") provided a loan to shareholders to...