Seminar: Hindsight bias in insolvency law
Scholars and lawyers come across situations where insolvency office holders (court-appointed administrators/trustees) of insolvent/bankrupt companies chase the company’s directors, and sometimes shareholders, because the directors/shareholders did not prevent the insolvency/bankruptcy. In addition, the insolvency office holders may initiate proceedings against those parties, claiming mismanagement, damages or even the entire deficit, in order to ‘reconstruct’ (or reconstitute) the bankruptcy estate.
Occasionally, an insolvency office holder has an interest in the outcome of these proceedings or settlement because the proceeds will be used to cover his costs and salary. The sole fact that the company went bankrupt becomes a factor (and presumption) of wrongful acts by the directors and the burden of proof of the contrary shifts to them. Subsequently, a court from time to time seems to have difficulty in recognising and/or considering the risk of hindsight bias in its judgment regarding the behaviour of directors.
Inaugural Address of Reinout Vriesendorp
This topic will be touched upon in the inaugural address on Friday, 24 June 2016, marking Reinout Vriesendorp's formal acceptance of his appointment at Leiden University as Professor of Insolvency Law (partially as successor of Bob Wessels) in the Leiden Law School.
In this inaugural address, Reinout Vriesendorp will deal with issues related to hindsight bias in insolvency law (esp. related to directors' liability, transaction avoidance and fraudulent conveyance issues) and the factor of coincidence in the assessment by administrators and courts of events and behaviour by directors in the twilight zone of a company before its ultimate insolvency.
Because the inaugural address will be in Dutch, even though this topic is not limited to Dutch law, the hindsight bias issue with recent developments abroad will be the subject of a mini-seminar in English with contributions from various foreign jurisdictions, including Belgium, Germany, Italy, Netherlands, and UK, and potentially France and Spain. The mini-seminar hopes to foster a debate about possible cross-border experiences and solutions.
To join (one of) these events, please register via Bedrijfswetenschappen@law.leidenuniv.nl