Understand Your Rights. Solve Your Legal Problems
The word ‘bankruptcy’ can send shivers down any business person’s spine, even though there are many solutions available to save a company from collapsing. We speak with Serafim Sotiriadis, whose firm, for almost 10 years, has dealt with various clients and has succeeded to facilitate the restructuring and reorganisation of some of the most important companies in Greece.
He speaks on the types of companies that resort to pre-bankruptcy proceedings and the challenges they are often presented with.
Who are the types of clients you mostly deal with in pre-bankruptcy matters?
The types of companies that mostly resort to pre-bankruptcy proceedings are large corporations with huge revenue rate, mainly Societe Anonyme Companies and Limited Companies. The industry that was affected the most by the recent financial crisis was real estate with many construction companies resorting to Articles 106b and 106d of the Greek Bankruptcy Code, the major pre-bankruptcy proceedings in the Greek legal system right now. Other than that, retail industry companies have also successfully entered into restructuring plans. Generally speaking, we have witnessed every type of company achieving to restructure its debt and continue operating in a financially healthier environment.
Are there any challenges you encounter in these proceedings?
The clients usually come to us facing economic issues that need to be resolved very quickly, as the enforcement proceedings against them are accelerated by their creditors, very aggressively in many cases. Therefore, the major challenge for these companies is to have the necessary time to negotiate and conclude a restructuring agreement and a viable business plan for the future. Further, having secured that the legal and financial status of the company will not change in the interim period until the conclusion of the agreement,a following significant issue is to convince the creditors to consent to this agreement. Traditionally, creditors used to be reluctant, but “our approach” has demonstrated great results achieving consensus among the creditors with favorable terms and conditions.
If you could change any laws related to restructuring in Greece, where would you start?
First, I would like to stress that the Greek law has made huge steps towards the modernisation of the restructuring law regime and is now in sync with the evolvement being made in EU. Therefore, in our opinion, the Greek restructuring law regime does not need substantial changes.
The problem is not found in law itself but in law in action, meaning how the law is implemented. To highlight a few discrepancies, the Courts are sometimes slow at issuing their decisions, posing great uncertainty, while it is in question to what extent the Courts will determine the financial situation of a company regarding its future viability. Nevertheless, the Greek law now leaves the pure economical elements to be determined solely by the accounting expert, demonstrating the Greek law’s responsiveness and flexibility once again.
Serafim Sotiriadis, Attorney at Law, the Founder of Serafim Sotiriadis and Associates, is a graduate of Athens Law School and a member of the LAA since 2001. As a specialist in major debt restructuring and insolvency, Serafim frequently lectures on corporate reorganisation and the restructuring of bank loans, having been personally involved in some of the most significant cases to have taken place in Greece. He has extensive experience in bankruptcy processes and extrajudicial loan renegotiation, as well as judicial experience in defending cases related to financial white- collar crimes. He provides international and Greek legal and tax advice to foreign law offices and corporations concerning cross-border buyouts, real estate ownership, investments in listed Greek companies, and the establishment of foreign companies, subsidiaries and branches in Greece. Serafim also offers assistance with international real estate transactions and acquisitions of “golden visas”.
The legal profession is often heaving with stress, so in light of National Stress Day, we hear from Jane Jukes, a Psychotherapist, who shares insights into stress and how you can ensure it does not control you.
Stress: a bad thing, right?
Well, not necessarily, or at least it certainly is not that simple. According to Kelly McGonigal, a leading health psychologist, it is, in fact, our view of our stress that is the most damaging. A recent study revealed some quite shocking statistics. It is our belief around stress that dictates the outcome of its physical, mental and emotional effect on us. Whether it is our perception or reality that is correct, we can certainly not ignore the enormous impact stress has, not just for ourselves, but especially within our working environment.
Learning how to best cope with that stress is key to living a healthy life. Mental Health Foundation state that 74% of the UK workers report that they felt overwhelmed or unable to cope with the stress they have had over the past year; 32% have had suicidal thoughts. The Health and Safety Executive (HSE) statistics state that 526,000 people report suffering work related stress, depression or anxiety (2016/17). 12.5 million working days were lost due to work related stress, depression or anxiety. The contributing factors were lack of support, bullying, lack of autonomy or imposed changes and workload. The weight of this work load responsibility, and their deadlines alone can be extremely anxiety provoking.
Some of us thrive off this, but others less so. The societal norm is to applaud this and indeed it is rarely crowded on the train to achieving the extra mile, so we know that both personally and professionally this attitude can work… until it doesn’t.
According to HSE, legal professionals are third on the list of most stressful jobs and fourth in the suicide rate. The problem with becoming more resilient is that you are improving on your already remarkable ability to keep going, despite the level of extreme demands.
When struggling with high levels of stress and work life balance, it may be that one is seeping into the other.
Combine this with the natural tendency of the legal profession taking responsibility of being one of the leading factors contributing to depression, and you have a recipe of disaster. Do not allow your career to define your sense of self: your self-worth needs to amount to more than your working ability.
A certain amount of stress is a normal part of life. How we respond to it is key. One of the most important things is to take control of what you can change and try to accept the things you can’t. We often wrongly assign our feelings.
Our conscience self-allocates responsibility for stress in an area of our lives, but similar to anxiety, it’s not always easy to ascertain the cause, which could be something you are not always likely to suspect, or, an unrelated factor such as marriage: we can often blame our marriage for work troubles, or vice versa.
It is often best to remember that the winning traits of your professional life may be hugely detrimental in your personal life. Be aware in the act of winning, you may be losing what is truly important to you.
When struggling with high levels of stress and work life balance, it may be that one is seeping into the other. Although it is easier said than done, try to set boundaries; create a clear distinction between personal time and work time.
These boundaries have become more difficult to impose with technological advances. Our devices can fulfil our deepest desire for personal interactions, feelings of self-worth or, simply, feed our feeling of relevance: ‘I’m in demand, therefore I am loved and necessary’. This, in turn, feeds our egos and temporarily makes us feel more secure.
In fact, some suggest the devices themselves have become attachment figures or security blankets fulfilling our unconscious needs. Next time you are on the train have a look around and see the “sippy cups” of latte and iPhones acting as security blankets, that we cling to in order to comfort us, often even without realising it. Be aware of your unconscious ‘child’ looking for validation and recognition. Do not allow yourself to sit as the chairman of the committee meeting in your mind. Your inner tyrannical self can be quite successful at getting what it wants but can also drive everything else over a cliff.
Do not suffer in silence: work smarter not harder.
Problems arise when the balance between our work life and personal life becomes skewed, and our work life starts to take over. This may sound simple but the most important thing to remember when this happens, is to take control. Create proper boundaries between your work and your home, including your phone. If necessary, book time off from your phone and all other electronic devices. Quite literally diarize time off. If you can’t, you may need to alter the way you work, during your work hours only.
We all know our billing hours rarely reflect the hours that we have actually put into the working week. Try to be aware of not relating to yourself as a means to an end.
Are you using your drive to succeed as a way to bulldoze through life?
Often this high stress way of being can overshadow the simple fact that you ought to be the priority in this life. Meeting the needs of your professional life can help to make us feel invincible – an intoxicating cocktail! Work can be as addictive as a drug - if you are too hooked on it, you struggle to do something about it.
Make sure the voice inside your head is on your side. Above all, be kind to yourself and those around you.
Top Tips on Tackling Stress:
Videos to watch:
These suggestions may sound simple however when we are stressed and overwhelmed sometimes it the simplest things we forget. Prevention is better than cure.
If life becomes too overwhelming, consider seeking therapeutic support. Make sure the voice inside your head is on your side. Above all, be kind to yourself and those around you. When retirement looms you will be glad you did!
Written by Jane Barnfield Jukes, Psychotherapist Founder of all natural supplement range, Eudeamon www.eudeamon.com, and The Practice therapy services www.thepractice.co.uk
Janes’ approach is first and foremost orientated towards a natural approach to wellness. She believes talking therapies and Eudeamon’s natural health supplements used as part of a programme of exercise, healthy eating, and therapeutic support will help you embark along the path to a healthier way of being. She feels that there is a place for pharmaceutical intervention but also a more natural alternative.
Brazil is a country that, naturally, undergoes a constant process of updating itself. We embrace this view. Augusto Neves Dal Pozzo expects that Brazil will flourish in terms of national and international investments in infrastructure in the years to come, and that in addition to meeting the needs of the population in sanitation, urban mobility and education, Brazil will offer a highly qualified business environment for investors: a serious, ethical environment with public managers committed to good practices and compliance.
Dal Pozzo states he is prepared for this. With a highly qualified team, composed of lawyers with solid training and experience, he believes that the moment is absolutely suitable for them to change the perspectives of curious internationals and, through law, they can collaborate as transforming agents of societal conditions. He expands: “I believe that this is the dream of every lawyer working in Administrative Law.”
“We are prepared to serve international clients interested in infrastructure investments in Brazil, with a roster of professionals who are knowledgeable about the whole process, to offer, under national conditions, the necessary certainty, with serious, committed models that meet the aspirations of all.”
In our cover story this month, Augusto speaks about the infrastructure market in Brazil and how academia and research fits into his everyday practice in law, of building a better Brazil, for its citizens and beyond.
It is increasingly necessary that those responsible for applying the law to specific cases have an effective knowledge of this complex legal regime, so as to ensure that the contracts fulfil the aspirations of those involved and, especially, serve the users who will benefit from them.
You have been immensely recognised for your work regarding judicial matters in the infrastructure market in Brazil; can you share with Lawyer Monthly more about your work in this area?
Ever since the beginning of my career as a lawyer I have been dedicated to the study of Infrastructure Law, not only in Brazil, but also in the international arena. I believe that our country offers a very favourable environment in this area considering the immense deficiencies that unfortunately exist, but which on the other hand, generate many investment opportunities in the area.
We participated in a vast array of projects in which the legal solutions presented by us enabled investments in the infrastructure market, whether connected to more socially driven aspects such as basic sanitation, education and public health, as well as logistics infrastructure related to deficiencies in urban mobility systems, road, rail, collective, port and airport transport, as well as other sectors connected to the energy matrix and telecommunications.
Issues arising from imperfect management of infrastructure contracts are also the subject of great care by the firm, involving qualified sectors, such as public services. The dynamics produced by incomplete contracts - which then results in the need for technological updating and correction of imperfections of the original model -, allied to the ever-changing concrete reality, requires, at all times, precise legal action with public authorities and their regulatory agents, so that the desired results be effectively achieved. Our joy, in this case, is doubled, as we not only collaborate with our client in the interpretation of legal matters, but also, and at the same time, improve the living conditions of the Brazilian population, thanks to infrastructure projects.
I believe that the business environment is undergoing an evident transformation in Brazil and, therefore, we are immersed in a favourable moment for an ethical, responsible and technically qualified performance.
As Professor of Administrative Law, what do you think are current interesting research points in this area of law, and why?
The modeling of concession contracts, public-private partnerships, and high-level public works contracts is also a major theme that allows for deepening academic studies. At the end of the day, everyone involved in these projects wants to know how they can finance the high costs that infrastructure projects entail, and how best to recover investments in an environment that embraces legal certainty and legitimate expectations. When one thinks that all these questions are formulated in an environment of high regulation and control of the official bodies and that, obligatorily, we must watch over the good practices of governance and compliance, we perceive the importance that the subject assumes today in Brazil. It is increasingly necessary that those responsible for applying the law to specific cases have an effective knowledge of this complex legal regime, so as to ensure that the contracts fulfil the aspirations of those involved and, especially, serve the users who will benefit from them.
The firm staff is constantly improving, both in the knowledge of market information and in the technical qualification so that we can meet the needs of clients and of domestic or foreign investors.
I have always believed that research, amplified theoretical references and the study of national and international cases, offer us the conditions to build a legal thesis capable of meeting the needs of the client.
From this, do you see any changes in the horizon, for lawyers and their clients / the public?
I believe that the business environment is undergoing an evident transformation in Brazil and, therefore, we are immersed in a favourable moment for an ethical, responsible and technically qualified performance. This attitude is widely valued.
Another major topic, as already mentioned, is the enormous shortages in the field of infrastructure, in various regions of Brazil. As the eighth largest economy in the world, this situation needs to be addressed by governments at the federal and regional levels. There is no way of promoting national development without the realisation of infrastructure projects. This horizon strengthens our performance as specialists in the subject. We can offer our national or international clients the security of a service that is not only technically accurate, but also indispensable in the construction of a viable and profitable project and which fully serves the public interest.
‘Smart’ cities are already a reality on which we are focusing, including helping public authorities to find solutions that meet the growing demands of their citizens.
For over 20 years, you have worked on extremely complex public contracts; how do you overcome the complexities? What process do you undergo when you are devising a juridical solution of strategic issues in this area?
After so many years of experience, it seems to me that overcoming the difficulties of these complex contracts is only possible through serious technical deepening. I have always believed that research, amplified theoretical references and the study of national and international cases, offer us the conditions to build a legal thesis capable of meeting the needs of the client. I also insist in working as a team. There are always valuable collaborations in the process of building work, as a result of the lawyers’ experiences. I'm part of a winning team!
In the last years I have intensely updated my work through international incursions that introduce me to new models of action that I seek to adapt and bring to the Brazilian reality. This has been of great value and makes all the difference, so much so that we started an internal project to encourage other legal teams to have this type of opportunity.
Brazil is a country that, naturally, undergoes a constant process of updating itself. We embrace this view.
Are there any regulations which pose challenges for those in construction? Do you think these regulations should be altered?
Law is a dynamic activity, mainly Administrative Law, due to its character and vocation to govern the relations between private parties and the public entity in the provision of benefits to the community. In recent years we have been able to experience significant advancement in some aspects and many still need improvement. I believe that the concerns refer to the adequacy of norms, as contrasted with the speed of modern times, through a process of interpretation and application of the law that meets the aspirations of the parties involved.
The digital society has changed paradigms and needs, and it is imperative that public services meet the demands of the population, both in quality and in quantity. Universalisation is an unavoidable need: it is necessary to place the citizen at the centre of public authorities’ attention, since this is the main duty of the State. Technological innovation, biotechnology, artificial intelligence, the big data are pressing realities, which will require that public authorities and everyone who is contractually involved with them adopt a new view of current thinking, so that citizens' quality of life be in consonance with the constitutional principle of dignity of individuals. ‘Smart’ cities are already a reality on which we are focusing, including helping public authorities to find solutions that meet the growing demands of their citizens.
What motivates you about your role?
Practice the best possible law; being the most innovative with my solutions, the most respectful to society, thus bringing better results to customers, loyalty towards my partners, firm colleagues and the entire legal community. The law that is the most efficient: this is why I divide my day-to-day schedule between the office, the academy (with classes for undergraduate and graduate, lectures and publications) and participation in representative institutions. This trinomial gives me the differentiated condition of experiencing varied facets of law, and of consistently claiming the best solutions to the problems of the clients that we represent.
At the firm we conquered a prominent position in solving complex cases that became paradigm for all the activity. I am proud to be a part of these projects and to continue researching in order to prepare myself for those still to come.
How have you seen law change overtime?
This is another motivation for us to always be updated: changes meet the demands of society which thus enforces the need to improve existing laws. Brazil is a country that, naturally, undergoes a constant process of updating itself. We embrace this view. We, lawyers, need to be prepared for this. Very recently we have adopted a new Code of Civil Procedure; we are already preparing for the changes in the Penal Code and still live with a tax regime almost casuistic, which changes daily. This is our daily challenge. I have been invited by Professor Marcio Cammarosano, one of my masters of the academy, to take part in a Commission of Jurists created by the National Congress, which studies a profound modification in all federal legislation involving administrative law and the infrastructure sector.
Going under the knife is not an easy decision to make and even though medical practitioners follow a rigorous process, legal cases in this field continue to rise. Richard Matthews, Consultant Cosmetic and Expert Witness, discusses why this is the case and ‘warning signs’ people should look for, in order to avoid costly litigation.
What are common cases you are instructed on as an expert witness?
The scope of Personal Injury within my field of specialist knowledge includes:
I accept Instructions in cases of alleged Clinical Negligence (in which Breach of Duty of Care may or may not have been admitted) with respect to soft tissue problems/complications (including sensory &/or functional/motor changes) arising from:
and, in addition to the conditions listed above under Personal Injury, I consider cases involving:
It is well known that UK society in general has become more litigious over the last 30 years and the whole field of Plastic Surgery has certainly not been immune from this trend.
Why are these cases so common and what do you think professionals should do to avoid legal sanction?
The principal cause of personal injury is carelessness on someone’s part, whilst the main cause of clinical negligence is failure to adhere to best practice, coupled with lack of vigilance.
It follows that doctors and nurses need to be vigilant at all times and to adhere to best practice, not least with respect to informed consent and both knowing and adhering to best practice. Getting sufficient sleep when off duty, being as good as possible as a communicator and saying ‘sorry’ when necessary, are additional important steps towards avoiding allegations of clinical negligence and possible consequent legal sanction. Naturally, making dated and timed, regular, legible, detailed and signed clinical notes is mandatory.
How have you seen cases involving plastic surgery change over the years? Have regulations become tighter to better suit patients?
It is well known that UK society in general has become more litigious over the last 30 years and the whole field of Plastic Surgery has certainly not been immune from this trend. Unlike most other surgical specialties, plastic surgical results are immediately ‘on show’, whether of a reconstructive nature or cosmetic. This latter category is particularly at risk of litigation if expectations are not met for whatever reason.
It is therefore essential to manage expectations effectively and to screen out patients who are psychologically unsuited, or even mentally unstable. Recent government directives on Cosmetic Surgery, aimed at protecting the public in general and potential patients in particular, have improved patient access to reliable information, such as a surgeon’s professional details, numbers of specific procedures performed and his or her outcomes. Previously, the only dependable source of information had been the British Association of Aesthetic Plastic Surgeons (BAAPS) annual data survey of its individual members outcomes (this survey continues). BAAPS is thus a good touchstone for anyone contemplating cosmetic surgery and a patient’s general practitioner (GP) will also be able to provide advice on who may be reliable locally.
At consultation, patients should assure themselves that the surgeon does not appear too tired or in too much of a hurry.
It is now incumbent on cosmetic surgeons to inform GPs that their patient has been seen in consultation and of plans made, thereby giving GPs the opportunity to flag up any additional patient details that might affect the decision to operate, which should not be within 14 days of the specialist consultation (cooling off period). Additionally, it means that the GP is ‘in the loop’ should there be any postoperative problems that may require community input.
Although there is still a shortage of psychologists with the specific training and expertise to assess patients prior to planned cosmetic surgery, the tools for doing so have improved and the emphasis is on surgeons to make such a referral for preoperative evaluation, where there may be any element of doubt.
What are the ‘warning’ signs patients should look for in order to avoid falling into legal disputes?
All of these [aforementioned] measures have served to improve protection of patients (and inevitably also surgeons) contemplating and undergoing cosmetic surgery and to reduce risk.
Despite this, cases in which legal action has been taken following a plastic surgical procedure continue to rise and it is worth considering what patients should look out for in order to minimise their risk and to reduce their likelihood of becoming involved in legal action, which can be very stressful and expensive.
Finding a surgeon has already been alluded to. Cosmetic Clinics (CCs) present risk in this area as surgeons from overseas may fly in to fulfil commitments to the Clinic, sometimes at quite short notice, making it difficult for a patient to really know much, if anything, about who is going to operate on them. Similarly, the surgeon may not be around for long post-surgery. Government directives also recommend a second consultation which may not necessarily occur at CCs.
Whether the plastic surgical care is reconstructive or cosmetic, patients should always be ready to question anything about their care within reason, particularly if something seems strange or wrong.
At consultation, patients should assure themselves that the surgeon does not appear too tired or in too much of a hurry. Patients should be prepared to ask questions (at any time for whatever clinical care they are receiving) and to receive clear jargon-free explanations, backed up by written material (information sheets, etc). The best surgeons will send a customised, detailed letter summarising the consultation, including potential complications and costs. Patients should see someone else if they are not comfortable, as maximum trust in the patient-doctor relationship is key.
Most Cosmetic Surgical procedures are offered as part of a package through an Independent Hospital in a Group or through a Cosmetic Clinic/chain. It is imperative that patients check carefully what is and what is not included; facing unexpected costs fuels the likelihood of taking legal advice. The old adage ‘Buyer beware!’ is very relevant.
Whether the plastic surgical care is reconstructive or cosmetic, patients should always be ready to question anything about their care within reason, particularly if something seems strange or wrong. It may be that all is well, in which case the reassurance will be helpful; alternatively, promptly drawing attention to something that has been overlooked may avoid a significant problem altogether. The good doctor and nurse will always make time to answer such questions and, as no one (and no system) is infallible, should be grateful whenever their attention is drawn to something untoward.
In conclusion, this approach to clinical interaction by both patients and their medical and nursing carers, if carried out diligently and in good faith, should lead to a reduction in legal disputes which, whilst possibly unwelcome to the legal profession, would be greatly to society’s benefit.
"I am Richard Matthews, Consultant Cosmetic, Burns, Reconstructive Plastic and Hand Surgeon and Member of The Academy of Expert Witnesses and of The Federation of Forensic & Expert Witnesses. I have over 30 years’ experience as an Expert Witness, taking Instructions from Solicitors for both Claimant and Defendant and as Single Joint Expert and I provide over 60 Reports a year for The Court covering Personal Injury (Condition & Prognosis) and Clinical Negligence (Condition & Prognosis &/or Breach of Duty of Care &/or Causation).
My company, ‘Richard Matthews Surgery Ltd’, is based at The Nuffield Health Warwickshire Hospital, Leamington Spa CV23 6RW. My Secretary, Sally, may be contacted there on 01926-436341 or at Sally.Bates@nuffieldhealth.com ."
Michael Sheridan shares below common myths surrounding bankruptcy. In this insightful article, he touches on what often leads people to filing for bankruptcy and why it is not always a bad thing.
What are common misconceptions you find that clients have towards bankruptcy?
Most of the common misconceptions - such as ‘you will lose your home, your car and all of your assets’ and ‘your credit will be destroyed for years’ – stem from the myth that the bankruptcy laws are somehow designed to punish debtors (i.e., people filing for bankruptcy) who are exercising their bankruptcy rights. The logic, I suppose, is that the court will remove your debts, but as a punishment, the court will take all of your large assets and destroy your credit, so you are not tempted to file for bankruptcy protection in the future.
Most people are surprised to learn how generous the asset protections are in bankruptcy.
This myth is completely antithetical to the true goal of the bankruptcy laws: to give the honest debtor a fresh start. A fresh start is removing the legal obligation to pay most unsecured debts (credit cards, loans, lines of credit, etc) and even tax debts if certain criteria are met, and permitting the filer to keep most, if not all, of their assets so they can provide for themselves and their families. Most people are surprised to learn how generous the asset protections are in bankruptcy.
For example, in Minnesota, we can protect up to $395,000 of equity in your home. That’s equity – the value over and above the balance of your mortgage. I estimate that for 98% of our clients, Atlas Law Firm is able to protect all of the clients’ assets.
Most of the common misconceptions - such as ‘you will lose your home, your car and all of your assets’ and ‘your credit will be destroyed for years’ – stem from the myth that the bankruptcy laws are somehow designed to punish debtors
Regarding the misconception that bankruptcy destroys your credit, that perception entirely disregards the positive affect bankruptcy can have on your credit score. While the exact formula used to calculate credit score is a closely-held secret, we do know that two of the biggest factors for determining your credit score are late payments (35% of your credit score) and debt-to-income ratio (30% of your credit score). On the date your bankruptcy is filed, the chapter of bankruptcy and the date of filing are listed in each of the tradelines in the account history section of your credit report. Because the credit score is using information from the account history section, the bankruptcy affects your credit score during that first month. However, the lower your credit score is on the date your case is filed, the less the bankruptcy will affect the score.
For example, if your credit score was near 630, we would not expect your credit score to decrease more than 15-20 points. The positive effect is that because on the date your bankruptcy is filed, regardless of whether it was a chapter 7, chapter 13 or any other chapter, a court order called an ‘automatic stay’ goes into effect immediately. The automatic stay prohibits any collection action from any of your creditors (with a narrow set of exceptions). This prohibition includes negatively reporting the accounts on your credit report. The negative credit reporting that has been an anchor on your credit score stops on the date your case is filed, so that you can begin rebuilding your credit.
People tend to make a fundamental attribution error that when something negative happens to people – like being in overwhelming debt – that the cause is due to the person’s internal characteristics.
Over your years of practice, can you share common trends that often lead towards bankruptcy? How do you advise clients in order for them to best prevent such fate?
There is a persistent myth that only spendthrifts or reckless spenders file for bankruptcy protection. I can tell you after meeting with thousands of people and discussing their circumstances with them, most people who file for bankruptcy protection are people who have used debt responsibly and have made their payments over the years, and then one of three things happens: unemployment or underemployment, divorce or medical debt. Once one of those triggers happens, it sends people into a financial free fall.
You’re forced to choose between paying necessary living expenses and paying down the debt. Trying to pay the debt, most people find themselves in the ‘credit card cycle.’ They use their income to pay their monthly credit card bills and then there is not enough income left over to pay living expenses. So, the living expenses are purchased with credit cards . . . and the balances grows.
Eventually the required credit card payments become too high to pay all of the credit cards and the collections process begins. You will notice that the three triggers are all external factors: losing a job, getting your hours cut, being diagnosed with a medical condition. These are all things that happen to people, they are not characteristics of people.
An emergency fund can help you address unforeseen expenses that commonly cause people to turn to credit cards.
People tend to make a fundamental attribution error that when something negative happens to people – like being in overwhelming debt – that the cause is due to the person’s internal characteristics. The fact of the matter is, life happens, and the bankruptcy laws are there to ensure people can get back on their feet and be able to provide for themselves, their families and their communities.
The best way to avoid a financial free fall is to build a savings safety net. An emergency fund can help you address unforeseen expenses that commonly cause people to turn to credit cards. It’s easier said than done, but setting aside a small amount of each pay check and having the discipline to only use it when truly needed is the best way to prevent exercising a debt relief option.
Clients can begin rebuilding their credit if they keep any debts through bankruptcy, such as a mortgage or a car loan.
When is bankruptcy the best option?
Bankruptcy is the best option when your income is not sufficient to pay your monthly debt payments and your monthly living expenses. If you’re running your household on a negative budget, other debt relief options such as credit counselling and debt settlement likely will not work. Bankruptcy is also the best option when you need debt relief quickly – such as when a creditor has obtained a judgment against you and will begin garnishing your pay check or when foreclosure is imminent and you need to power of the bankruptcy court to order a stay of the foreclosure of your home while you exercise your rights to lengthen the mortgage cure payments over five years.
How can clients recover, post filing for bankruptcy?
Clients can begin rebuilding their credit if they keep any debts through bankruptcy, such as a mortgage or a car loan. If they do not have a secured debt that they wish to keep after the bankruptcy, many clients are surprised to learn that they likely will get credit card offers within weeks of filing their bankruptcy case. The credit cards will be high interest rates, but can be used to make small purchases (e.g., small grocery trip or the phone bill) and pay the balance in full on time each month. Because the negative credit reporting has stopped, any positive credit reporting rapidly increases the credit score. We find that many of our clients have rebuilt their credit to a higher score than before their case within 12-18 months of case filing. How rapid and how high this is depends on whether they have a debt in their name after the bankruptcy that they continue to pay on time each month. Many clients qualify for good interest rates on auto loans within one year of their bankruptcy case and qualification for a conventional home mortgage is typically three to five years. However, home mortgages can be obtained after one year if the client qualifies for particular programmes.
After working at different law firms and finding the focus of those law firms to be on billable hours rather than legal representation, Michael Sheridan founded Atlas Law Firm in 2012 after leading the bankruptcy and debt restructuring department of a downtown Minneapolis law firm. Atlas Law Firm was founded to deliver legal representation to business and individuals in need of debt relief with a focus on excellent client service. All too often in the early years of his legal career, working at one of the largest bankruptcy firms in Minneapolis/ St. Paul, Minnesota, did Michael find that his contemporaries did not listen to their clients’ questions and concerns and instead talked past them providing basic legal information. Seeing busy lawyers delegate tasks and communications to assistants and paralegals because they were too busy to pick up the phone or write an email, Michael wanted to start a firm that offered the level of service he would expect should he need to hire a lawyer. The approach has been appreciated by the clients of Atlas Law Firm as it is one of the highest rated firms by its clients. Atlas Law Firm embraces the ‘client first’ approach and always takes time to carefully listen to its clients’ concerns and ensure they have all of the information they need to make an informed decision as to their debt relief options.
Litigation is famously known for being expensive and lengthy. With attitudes towards mediation slowly shifting, we get in touch with Anthony Trace QC from 4 Pump Court, who shares more on why mediation, especially for those in the banking and finance sector, is reaping benefits.
He states: “If anyone has not yet seen for themselves the benefits of mediation, then I would urge that the mediation process is tried with an open mind and a desire to settle. Doubters will, I am sure, be pleasantly surprised!”
It is often a much quicker process to get to mediation with many fewer documents
When should those in the banking and finance sector opt for mediation, as opposed to arbitration or litigation?
In my view, those in the banking and finance sector should seriously consider opting for mediation, as opposed to arbitration or litigation, for four reasons: first, mediation is not a combative procedure such that a deal is more likely to be achieved; secondly, mediation does not lead to a decision by a third party (i.e. a Judge or an Arbitrator) who may impose a resolution of the dispute that neither side likes; thirdly, using mediation is likely to result in a friendlier resolution of the dispute such that, if the parties wish to continue in a trading relationship, it may be much easier for that to occur; fourthly, the chances of an outcome that is swift are more likely in a mediation – on average some 86% of mediations settle on the day or shortly thereafter and it is often a much quicker process to get to mediation with many fewer documents (normally, a core bundle only with short Position Statements produced in advance of the mediation).
What common challenges are you presented with when facilitating an agreement between parties in the banking and finance sector? How do you overcome such challenges?
Common challenges presented when facilitating an agreement between participants from the banking and finance sector in a mediation are client confidentiality and disclosure of sensitive documents. For example, a dispute may raise issues that one party to the dispute says should be examined with a view to other deals, or so far as other clients are concerned. I find that the best way to deal with such matters is to raise them with the participants in the mediation in advance, so that any relevant approvals can be obtained.
Attitudes towards mediation have also changed amongst those traditionally resolving disputes such as the Judiciary
How have notions towards mediation changed over your years of practice? What else are you predicting for the future in this field?
Notions towards mediation have changed radically. Mediations used to be treated with great caution by parties to a dispute, partly I think because the process was not completely understood, and its benefits were not fully appreciated. Those notions have changed markedly in the minds of the parties to a dispute.
Attitudes towards mediation have also changed amongst those traditionally resolving disputes such as the Judiciary: there is a growing consensus among such people that parties should be encouraged to mediate if at all possible.
Moreover, from the above, as you work along several jurisdictions, would you say mediation is globally accepted, or is there still a way to go?
Looking at matters globally, there are some jurisdictions which are not as accepting of the mediation process as in the UK, but attitudes are changing rapidly.
Anthony Trace QC graduated from Cambridge with a First in Law in 1980. He was called to the Bar in 1981 and appointed a Queen’s Counsel at the young age of 39. During his 35-year career as a litigator he led in many of the most high-profile cases in the UK and International courts, including acting for Berezovsky, in the Lehman Brothers Administration and in the Beijing Olympics ticket fraud proceedings. His litigation skills and extensive knowledge of litigation are matters that he brings to his mediation practice at 4 Pump Court. Anthony is recommended as a Mediator in Global Legal Experts 2018. He is accredited by CEDR, is a Civil Mediation Council Registered Mediator and on the CEDR Consumer Panel. Anthony was voted “Commercial Mediator of the Year – England” in the CorporateLiveWire Global Awards 2018 and is recommended by Advisory Excellence for Commercial Mediation in England.
For appointments of Anthony as a Mediator, contact Carolyn McCombe: cmccombe@4pumpcourt.com
Stratulat Albulescu SCA has assisted EDS Romania during their acquisition of the heat-set printing business from Mega Press Holdings SA and Editura Aramis SRL.
EDS Romania is part of the Euro-Druckservice Group, which is a leading print service in Central and Eastern Europe that has been developing ever since 1992.
Managing Partner of Stratulat Albulescu SCA, Silviu Stratulat led this transaction with his team who structured the transaction, performed the due diligence, advised during negotiations and devised contracts to support the deal. The legal team assisted EDS till the closing of the deal by also providing financial advice regarding purchase price.
Infosat, a company leader in geo-intelligence services, sold Infomobility to the Private Equity Fund Palamon Capital Partners (PCP); PCP had also simultaneously took control of FairConnect, which already had a share of 53% in Infomobility.
Infomobility.it SpA is the leader of a group of companies, with the aim of proposing integrated and innovative solutions in the ‘infomobility’ market, of location based services. They develop and distribute technological services and since 2009, is the partner provider of Connected Insurance services of Generali Italia SpA and has since become a service provider partner for the Connected Home.
The Irti Law Firm assisted Infosat Srl in the operation. Gabriele Galletti was assisted by the lawyer Giuseppe Mazzella di Bosco.
The Irti Law Firm assisted Infosat Srl in the sale of the investment, and Gabriele Galletti, assisted by the Giuseppe Mazzella di Bosco team.
McDermott Will & Emery assisted Palamon Capital Partners, for corporate profiles, with a team led by partner Ettore Scandale, assisted by counsel Paolo Cocchini, and associate Oscar Arcà. For the Italian banking profiles, a team led by the partner Giancarlo Castorino acted by the counsel Agata Todarello and the associate Antida Cutuli.
The Swiss law profiles of the operation were followed by Kellerhals Carrard, involving partner Massimiliano Maestretti and of the associate Lorenza Ferro.
With regard to banking profiles under English law, Slaughter & May acted with partner Richard Jones and associates Adrian Wilkes and Christopher McCabe.
The funding was assisted by a cross border team of the CMS study, which was managed by the partner Paolo Bonolis and the counsellor Maria Giovanna Pisani.
Teijin Frontier Co., Ltd. is a wholly owned subsidiary of Teijin Ltd., a Japanese chemical and pharmaceutical group with around 20,000 employees and annual sales of more than € 6 billion. The company is listed on the Japanese stock market (WKN: 855254/ISIN: JP3544000007). Its subsidiary Teijin Frontier Co., Ltd. specializes in the manufacture of clothing and industrial textiles, so that the takeover of Ziegler represents an attractive expansion of its portfolio, whilst simultaneously enabling entry into the European market.
In 2014, DPE acquired a majority shareholding in Ziegler with the intention to achieve significant growth through extensive investments in production technology designed to expand specific capacities and streamline the product portfolio. “We are pleased that we – together with the management team of Diedrich von Behr – could demonstrate Ziegler’s full potential”, commented DPE partner Dr. Frank Müller. Furthermore, Ziegler has, under DPE’s direction, established sales offices in the US and China. From this basis of growth, Ziegler acquired additional high-profile customers in the US and Asia, and created new vehicle platforms in Europe. Sales have increased under DPE management from € 44 million (2013) to over € 75 million (2018e). The number of employees increased in parallel by almost 50 % to more than 400.
JSW Steel Italy S.r.l. (subsidiary of JSW Steel Limited) has entered into a Sale and Purchase Agreement (“SPA”) with Cevitaly S.r.l (“Cevitaly”) a company governed by the Italian law, for acquisition of 100% shares of Aferpi S.p.A (“Aferpi”), Piombino Logistics S.p.A (“PL”) and 69.27% of the share capital of GSI Lucchini S.p.A (“GSI”) (jointly referred to as “Targets”), for a cash consideration of Euro 55 Million on a cash free, debt free basis (the “Transaction”) subject to closing adjustments including for working capital of the respective Targets. The above facilities are located in Piombino, Tuscany Province, Italy. The Transaction is subject to fulfilment of conditions precedents and other customary terms generally applicable to such transactions as per the SPA.
The Transaction provides a unique opportunity for JSW Steel to establish its presence in Italy with access to the European speciality steel long products market. The Transaction will also provide JSW a foothold for future opportunities in the European markets.
The Transaction is proposed to be funded through a combination of internal accruals and debt at the Targets.
Interview with Enrico Mugnai at Tombari D'Angelo e Associati - Studio Legale
What challenge arose? How did you navigate them?
The transaction was undoubtedly characterised by a high level of complexity, which can be explained by reference to two main issues: the particular legal framework governing it and the combination of numerous parties both private and public entities, all involved at different levels in the process.
More in particular, one challenge we faced was that the seller had formerly bought the target companies under the legal “umbrella” of the insolvency regulation of the extraordinary administration of large companies, which, inter alia, imposes specific duties on the buyer under the supervision of the Commissioner, in this case guaranteeing the continuity of the business and maintaining the same workforce. Those issues needed to be dealt with on a separate and contractual basis in the context of the new acquisition.
In addition to this, as far as the environmental aspects are concerned, the transaction had to take place under the special legal regime of the Legislative Decree 152/2006, which envisaged the execution of a new general programme agreement with all the Public Institutions involved.
What was one lesson you learnt after working in this transaction?
Our law firm and our team were involved as legal adviser to JSW in order to assist the client in the negotiation of all relevant agreements to be executed with the Lucchini Extraordinary Administration for the purpose of the acquisition.
One of the most challenging parts of this experience was certainly to harmonise and integrate those agreements into the whole M&A process, which implied a tight and efficient coordination with all other advisers involved in the transaction.
Please tell me about the current M&A field in Italy and how this deal reflects it?
From a general point of view, the analysis relating to the first nine months of the year shows a non-negligible increasing trend in the Italian M&A field, featuring a significant number of large investments by international groups
In this context, the Italian steel industry is undergoing a major transformation which seems to indicate that there will be a greater concentration of production and see the involvement of international leading players, interested in strengthening and consolidating their position in the UE market.
Looking closer at the deal, we can observe that M&A and restructuring operations involving large companies that have recently gone through periods of corporate crisis have certainly played a crucial role in this scenario.
