RSS feedsThe jobs of the remaining 165 employees at Granville Technology, the company behind Tiny Computers, have been secured for the time being after administrators Grant Thornton won a case in the Court of Appeal.
The application was made by Grant Thornton adminstrators to reverse the judgement of the Krasner vz McMath case, which found that protective awards and payments in lieu of notice received 'super priority' under the Insolvency Act.
As a result, such liabilities would rank ahead of all other payments in an administration, including not only the administrator's expenses, but the claims of preferential creditors (including other employee claims).
In turn, the effect of Krasner made it more likely that administrators would 'play it safe' and terminate employment contracts within the first 14 days of the administration.
But Mr Justice Etherton decided to reverse the Krasner decision.
Grant Thornton's lawyers, Lovells, said that the judge's decision restored the position as understood before Krasner, and ensured that the 'rescue culture' was not frustrated by these employment liabilities attracting 'super priority'.
