The Insolvency Act at 40: Reflections from the Class of 2026 sessions at R3’s Annual Conference

11 June 2026

Richard Obank, Restructuring and Insolvency Partner at BCLP, summarises four sessions at our Annual Conference which explored how insolvency law and practice in England & Wales has evolved over 40 years and what the future may hold. 

A classic at forty

Budapest provided a fitting backdrop for R3’s Annual Conference in May 2026 which was themed by R3 President, Sonia Jordan and the organising committee as ‘40 years forward: Learning from the past and the present, leading into the future’. 

As delegates gathered in one of Europe's grandest cities, the occasion offered a chance to celebrate four decades of one of the most enduring pieces of commercial legislation in UK history: the Insolvency Act 1986 (1986 Act). This classic piece of legislation was born out of political and economic turbulence with rising corporate failures, creditor dissatisfaction, an archaic insolvency system and a recognition the law was not fit for purpose.

The 1982 Cork Report provided the architecture for radical reform. Its aims of rescuing viable companies, maximising recoveries for creditors and holding directors to account were bold, ambitious and, as forty years of insolvency law and practice has demonstrated, fundamentally sound.

Session 1: Welcome to Jurassic act: When insolvency roamed free

During the opening session, Colin Haig gave a vivid account of what insolvency practice looked like before the 1986 Act with practitioners in the 1980s experiencing a very different world to that of today. 

Mae Strachan, representing the Class of 2026, asked whether the pre-1986 Act era was truly the ‘wild west’ which prompted honest reflection on a system which was not simply chaotic but lacked the regulatory scaffolding to generate public trust.  

The introduction of licensing and ethical standards marked a turning point building public trust at a time when corporate failures were at record levels.  

The shift which emerged was not just procedural but cultural. New tools were introduced but it took time for a new rescue mindset to follow. 

This session gave us fresh perspective from a younger professional with a contemporary focus on professional standards.  

The speakers concluded that the 1986 Act provides a framework which has been tested by recessions, a global financial crisis, a pandemic and the full power of technological change. Despite everything, it remains one of the most respected insolvency regimes in the world and, in Colin’s words ’a platform for practitioners to do the right thing for creditors’.  

Session 2: Death of a receiver: How administrative receivership met its (legislative) end 

Camilla Mulholland, representing the Class of 2026, and David Hudson’s session focussed on the Enterprise Act 2002 (2002 Act) which significantly reformed corporate insolvency procedures.  

David recalled a gradual, rather than immediate, transition from administrative receivership to administration as a means of corporate rescue. As with earlier reforms, the cultural shift took time to become familiar. 

The 2002 Act introduced a more streamlined and transparent administration process shifting focus away from secured creditors which defined the receivership era. Pre-pack administrations also emerged, allowing quick sales of viable businesses which often achieved better results for creditors while saving jobs and preserving value.  

However, secured creditors continued to control the appointment of administrators, raising doubts whether ‘the rescue rhetoric’ was matched by reality.  

This session gave us memorable (if slightly harrowing) stories about dealing with mass redundancies on site. The treatment of employees required empathy and an understanding of the community impact which remains as true today as at that time. However, in the past, junior staff were often left alone on site to handle redundancies and other trading issues with little or no supervision. Fortunately, the sink or swim approach to junior staff has been eclipsed by more responsible employer attitudes.  

This session reflected on Re Spectrum Plus which fundamentally altered commercial lending by confirming that a bank’s charge over a company’s book debts was a floating, rather than a fixed charge, where the borrower retained control over the funds. The ruling overturned 25 years of banking convention and significantly reduced banks’ recoveries in corporate insolvencies, signalling the end of a golden era for banks.   

Session 3: Lever v Phillips KC [2026]: It's a case of the common law  

Mark Phillips KC and Class of 2026 representative, Carl Lever, structured this session around four key periods, revealing that the common law has been at least as powerful in shaping insolvency practice as Parliament. 

Period one 

This took us from the rescue culture envisaged in the Cork Report through to the introduction of the 1986 Act, along with key early cases like Atlantic Computer Systems, Paramount Airways and Charnley Davies.  

Charnley Davies, the first administration made the day after the 1986 Act’s introduction, prompted litigation after creditors alleged a business sale by administrators at a grossly undervalued price. The creditors argued they should have been consulted before the sale and had been unfairly prejudiced.  The courts found that the administrator had not unfairly prejudiced the creditors and rejected the argument that the standard of care had fallen short of what is required, namely that an administrators’ duty is to take reasonable care to obtain the best price in the circumstances. This was to be judged by the standard of an ordinary, skilled practitioner. The case established the professional standard of care still applied today.  

Paramount Airways confirmed that when administrators retain employees for more than 14 days they are treated as having automatically adopted those employment contracts. Unilateral attempts to avoid adoption through liability disclaimers were ineffective. Once the contract of employment has been adopted, this applies to the contract in its entirety. The consequence of this was to give ‘super-priority’ to employment liabilities (the alternatives being to dismiss the workforce within 14 days of appointment or negotiate entirely new contracts).  This case highlighted the hazardous nature of trading administrations arising from the tension between a rescue culture ethos and individual creditor rights.  In response, Parliament sought to avert the prospect of widespread closures of insolvent businesses by enacting emergency legislation in the form of the Insolvency Act 1994. This legislation came into force on 15 March 1994, restricting the liability of administrators to that of paying wages arising after their appointment in respect of adopted contracts of employment.    

West Mercia Safetywear established that when a company becomes insolvent or is bordering on insolvency, directors must prioritise the interests of creditors rather than shareholders. This case embedded the ‘creditor duty’ into English insolvency law. Directors could no longer use company funds with impunity in a dying business without facing potential personal consequences. This principle was later reinforced in the Supreme Court's decision in Sequana.  

Period two 

The panel considered the 2002 Act and whether ‘out-of-court’ appointments weakened the principle of company rescue. The aim was to address the perception that administrative receivership favoured secured creditors, particularly banks. In return for banks losing the remedy of administrative receivership, they obtained the right to appoint an administrator, a right later extended to company directors. This helped to drive the development of pre-packs to save a failing business but not the company.  

Period three 

The discussion focused on the financial crisis of 2008 and the global challenges posed by the Lehman Brothers collapse which exposed limitations in the English insolvency regime when dealing with complex, systemic failures. Drawing on personal experience, the speakers explored how this led to the development of special administration regimes for investment banks and e-payment institutions, along with the introduction of distribution plans, making the English framework more adept to the global challenges of a sophisticated market economy.  

Period four 

The speakers covered the Corporate Insolvency and Governance Act 2020 (CIGA) and the dawn of the restructuring plan. The discussion focussed on whether restructuring plans can deliver on the original aims of Sir Kenneth Cork given their high cost and complexity. Two main approaches have developed: using plans as a terminal process to improve creditor outcomes as an alternative to insolvency procedures such as administration or liquidation or as a tool to restructure complex balance sheets, often involving new funding. 

The courts have limited the ability of senior secured creditors to impose plans on junior creditors by relying on cross-class cram down. Cases such as Thames Water confirm that out of the money creditors cannot be ignored or excluded, a cause which Mark championed.  

The session concluded by highlighting concerns about the high cost of restructuring plans, which limits their accessibility for all but the largest corporates. Cases like Madagascar Oil and McDermott reflect strong judicial concern over excessive professional fees being incurred. This can happen when acting for the plan company or if a creditor objects to the terms of the plan, leading to unnecessary costs and court time being wasted.  

Despite the challenges posed by complexity and increased litigation, the courts have signalled a need for better cost control which cannot be ignored.  

Session 4: The new insolvency playbook: More complex, more human, more tech 

The final session looked at the insolvency profession today and where is it heading during which Tom Russell and Megan Campbell shared an honest, thought-provoking and genuinely inspiring discussion. 

Reflecting on his career to date, Tom noted how the role had evolved from realising assets and returning value to creditors to a greater emphasis on compliance and process.  

Looking ahead, the profession is increasingly divided between practitioners dealing with high-volume, low-value insolvencies and those dealing with more complex, international work at the top end of the market. This trend looks set to continue. 

A growing concern is the lack of a cost-effective rescue process for SMEs with existing tools often too expensive or complex to be of practical use. For example, Part A1 moratoriums, while providing a much-needed breathing space to avoid a formal insolvency, can be expensive to run given the monitor’s oversight.  

Increasing regulatory compliance means junior managers spend more time ‘on process not practice’ which pushes them into back office roles going over checklists. While important, this can limit opportunities for new professionals. One solution proposed was for more proportionate regulation that recognises modern practice and the need for greater cost-savings for creditors.  

The session also considered how far AI will transform the profession. Greater automation involving accounting systems talking directly to case management systems and automated creditor communications could reduce costs. The challenge will be to find creative ways to feed the talent pipeline at traditional entry levels to ensure AI does not deplete junior opportunities.   

Diversity and inclusion were also highlighted with the need for transparent promotion pathways and equal access to the best available work. It is crucial to have more leaders sponsoring roles in the workplace and promoting underrepresented groups such as by encouraging women into senior positions. Megan spoke powerfully about her own experience noting that while much had changed over the last decade, more needs to be done.  

The next decade will demand more adaptability, deeper expertise, more automation and a profession ready to navigate increasing complexity with confidence with individuals given equal access and promotion prospects.  

The Cork legacy and the Class of 2026 

Insolvency practice and procedure have travelled a remarkable distance from the economic and political challenges of the mid-1980s to a landscape that Sir Kenneth Cork himself might barely have imagined.  

Yet the profession’s core values remain unchanged – delivering fair and efficient outcomes for recovering and realising assets, protecting creditors and holding to account those responsible for failed companies. These are Cork's core values, and they still hold true today. 

The 1986 Act was born out of crisis and every reform since, from the 2002 Act, to special administration regimes, pre-packs, CIGA and restructuring plans, follows the same pattern: crisis, correction and improvement. That is not a story of decline; it is a story of a dynamic operational system that learns, improves, and endures. 

The Class of 2026: Mae Strachan, Camilla Mulholland, Carl Lever and Megan Campbell brought distinctive and invaluable insights, sharp intellect, genuine passion for the insolvency profession and the kind of energy that reminds experienced practitioners why they started-out in the first place.  

Their contribution was a reminder that the profession needs new professionals more than ever: not just for their technical ability, but for their fresh perspective, their willingness to challenge unacceptable practices in the work place and their readiness to be torch-bearers for Cork's values in a world none of us can fully predict, imagine or understand. Most importantly, they have shown that the future of the insolvency profession is in exceptionally good hands. 

And to the Class of 2027 - next year's conference in Dubrovnik awaits you! 

A note on scope 

This article focusses on the law in England & Wales. Whilst the 1986 Act extends in certain respects to Scotland and Northern Ireland, those jurisdictions have their own procedural framework which this article does not purport to address.  

This article is not intended to act as legal advice or to comment on the law in other jurisdictions. Practitioners advising on matters with a cross-border dimension should always take appropriate specialist advice.  

Case references 

National Westminster Bank plc v Spectrum Plus Ltd [2005] (UKHL 41) 

Re Atlantic Computer Systems plc [1992] Ch.505; [1990] B.C.C. 859 

Re Paramount Airways Ltd (No.3) [1994] B.C.C. 172 (Powdrill v Watson [1995] 2 A.C. 394 

Re Charnley Davies Business Services Ltd (1987) 3 B.C.C. 408 

West Mercia Safetywear v Dodd (1988) 4 B.C.C. 30; [1988] B.C.L.C. 250 

BTI 2014 LLC v Sequana [2022] UKSC 25 

Charles Adrian Macfie Maynard v Thames Water Utilities Holdings and others CA-2025-000371 

Madagascar Oil Limited [2025] EWHC 2129 (Ch) 

CB&I UK Ltd [2024] EWHC 398 (Ch.)