LA0862 - Corporate Debt and Restructuring

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SYNOPSIS OF MODULE

This module is one of the electives available to students during Stage 2 of the Legal Practice Course and forms part of the Commercial Route elective group.

The diverse content of this module covers some of the issues relevant to conducting business successfully in the modern world and will be of interest to any students entering commercial / corporate practice.

The aim of this module is to provide students with an appreciation of the legal and practical issues:
• arising when a company seeks debt financing;
• relevant to corporate rescue procedures; and
• with both personal and corporate insolvency in a business environment.

The legal skills of negotiating, drafting and practical research are also further developed in a commercial context.

This module is delivered by a combination of large group sessions, small group sessions and directed and independent learning. The module is assessed by examination.

INDICATIVE READING LIST OR OTHER LEARNING RESOURCES

Main Texts:
Banking and Capital Markets 2013, David Adams, CLP.
Insolvency Law Corporate and Personal, Prof A Keay and Prof P Walton, Jordans
e-Learning Portal and Materials
A range of materials to support both large and small group sessions and to facilitate directed learning will be provided via the Corporate Debt and Restructuring e-Learning Portal site.

OUTLINE SYLLABUS

Element 1: Corporate Borrowing
Students should develop a knowledge and understanding of the legal and commercial issues relevant to raising money through debt and should be able to:

1. Understand the nature of different types of structure for corporate borrowing;
2. Understand and be able to explain the key terms in a loan agreement;
3. Draft, review, amend and advise upon the key provisions in a loan agreement;
4. Understand the impact of the loan agreement on existing borrowing.

Element 2: Taking Security
Students should develop a knowledge and understanding of the legal and commercial issues involved in the creation of different types of security that can be created under English law and should be able to:

1. Identify different types of security that may be required and understand their relative advantages and disadvantages;
2. Identify and advise up on when appropriate security should be used in a simple secured loan facility;
3. Appreciate the different methods of perfecting security;
4. Understand the principles of law on priority of security;
5. Consider the principal terms of a debenture document.

Element 3: Personal Insolvency
The law and practice involved in personal insolvency (acting for both the debtor and creditor) including:

1. the legal, practical and commercial issues relevant to personal debt recovery;
2. Key documents in personal insolvency such as the statutory demand and bankruptcy petition;
3. creditors and debtors bankruptcy petitions;
4. issues relevant to recovering the assets of a bankrupt;
5. investigations into the affairs of a bankrupt and transactions that may be subject to challenge;
6. alternatives to the bankruptcy process.



Element 4: Corporate Insolvency
The law and practice involved in corporate insolvency (acting for both the debtor and creditor) including:

1. the legal, practical and commercial issues relevant to corporate debt recovery;
2. key documents in the corporate insolvency process;
3. compulsory winding up petitions and creditors or members winding up petitions;
4. recovering the assets of a company in liquidation;
5. investigations into the affairs of a company in liquidation and transactions that may be subject to challenge;
6. legal and practical issues relevant to the disqualification of directors of an insolvent company.

Element 5: Corporate Rescue Procedures
The legal and commercial issues relevant to administration and company voluntary arrangements from the different perspectives of the parties involved including:

1. the nature and effect of administration for both the company and the debenture holder and the outcomes that may be achieved through the use of this process;
2. the implementation of a company voluntary arrangement;
3. the nature and effect of company voluntary arrangements and their commercial role in corporate rescue;
4. the documents required to sell a company in administration as a going concern including pre-pack administration sales.

AIMS OF MODULE

The elective aims to provide students with:

1. An appreciation of the law which forms the foundation of commercial practice with particular reference to debt finance, corporate restructuring and insolvency;
2. An awareness of drafting issues in financial contracts and key insolvency documentation;
3. A knowledge and understanding of different forms of security required by lending institutions;
4. A knowledge and understanding of issues relating to commercial risk, conduct and regulation;
5. A knowledge of different forms of insolvency arrangements;
6. A knowledge and understanding of corporate rescue procedures and their commercial implications;

It is also designed to enable students to further develop:

1. Practical legal research and drafting skills acquired during Stage 1;
2. Negotiation skills;
3. An appreciation of the financial and commercial constraints on commercial clients and how they influence the role of the solicitor.

LEARNING OUTCOMES

On completion of the Corporate Debt and Restructuring vocational elective, students should:

1. Demonstrate a knowledge and understanding of different types of corporate borrowing;
2. Demonstrate a knowledge and understanding of different forms of security;
3. Understand the law which forms the foundation of personal and corporate insolvency;
4. Be able to draft, review and advise on the most common documents and agreements found in the insolvency and corporate rescue process building on the drafting skills acquired during stage 1.
5. Demonstrate a knowledge and understanding of the different types of insolvency (both corporate and personal) and how such processes are effected and the relative advantages and disadvantages of these from the varying perspectives of different parties involved in the processes.
6. Demonstrate a knowledge and understanding of procedures available to rescue businesses in financial difficulty; their commercial applications and the relative advantages and disadvantages of these options.
7. Be able to analyse and advise upon issues relating to financial risk and identify conduct issues as they arise.

PREREQUISITES

Business Law and Practice (gen/comm route)

COREQUISITES

None

DISTANCE LEARNING DELIVERY

N/A

LEARNING AND TEACHING STRATEGY

The module will be delivered through a combination of large and small group sessions, directed learning and independent learning.

The large group sessions will be delivered to the entire module cohort and will be used in part to introduce students to the major principles of each Element. They will place these principles in context by examining them against relevant factual scenarios.

The small group sessions (which will consist of between 16 – 20 students) will, in conjunction with the directed and independent learning, expand on the material covered in the large group sessions with emphasis on the use of practical scenarios as the basis for relevant skills based and interactive sessions to apply that material to the scenario. For example, some of the sessions will include the opportunity to participate in role play negotiations involving contractual terms as one of the legal advisers involved. Other sessions will require problem solving skills to identify key issues, plan strategies for taking problems forward and drafting aspects of the necessary documentation to do so. Where appropriate to the subject area, students will be required to analyse and critique relevant legal material.

Students will be given directed learning which will both expand on the materials provided in the large group sessions and cover specific topics not dealt with in those sessions. This will be supported by formative self-test and multiple choice questions. Students will also be expected to carry out independent learning to both expand on the materials covered in the large group sessions and directed learning and to prepare for the tasks in the small group sessions. Examples of independent learning will include locating and reading relevant legal source material.

Experiential learning is prevalent in the simulated practice exercises that take place in most of the small group sessions.

ASSESSMENT AND FEEDBACK STRATEGY

a Summative assessment and rationale for tasks

Summative assessment will be provided by an examination made up of a one hour closed book multiple choice paper plus a two hour open book practical paper based on advance documents. The use of advance documents allows the subject team greater opportunity to test knowledge and application in the examination and allows greater use of realistic legal scenarios.


b. Additional formative assessment – detail of process and rationale

Formative assessment will be provided by a combination of self-test questions and multiple choice questions which students will complete through the module e-Learning Portal site and in small group sessions.
Students will also have the opportunity to complete practice exam questions.


c. Indication of how students will get feedback and how this will support their learning

Detailed answers to the self-test questions and multiple-choice questions will be available on the e-Learning Portal and feedback on any practice questions will be given via the e-Learning Portal and in a large group session.

IMPLICATIONS FOR CHOICE

None

Course info

Credits 1

Level of Study Postgraduate

Mode of Study 1 year full-time
1 other options available

Department Northumbria Law School

Location City Campus, Northumbria University

City Newcastle

Start September 2020

Fee Information

Module Information

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