Inherent Jurisdiction for Post-Brexit Recognition of Northern Ireland Administration Proceedings

Introduction

This commentary examines the High Court of Ireland’s decision in Re: Mercer Agencies Ltd [In Administration] and an Application for Recognition and Orders in Aid of Foreign Insolvency Proceedings ([2025] IEHC 261). The applicant, Mercer Agencies Limited (“the Company”), placed into administration under the Insolvency (Northern Ireland) Order 1989 (“the 1989 Order”), sought recognition of its administrators’ appointment and powers in the Republic of Ireland. The joint administrators—Scott P. Murray and Ian Davison of Keenan Corporate Finance Limited—applied ex parte for an order that the Irish court act in aid of the Northern Ireland chancery court.

Key issues before the court were:

Whether the High Court retains a common law or inherent jurisdiction to recognise and assist foreign (post-Brexit) administration proceedings in the absence of the European Insolvency Regulation;
Whether there is sufficient equivalence between administration under the 1989 Order and winding up or examinership under the Companies Act 2014 (“the 2014 Act”); and
Whether recognition is sought for a legitimate purpose consistent with the administrators’ statutory duties.

Summary of the Judgment

Mr. Justice Michael Quinn reviewed the background of Mercer Agencies Limited: a Northern Ireland–incorporated wholesaler in financial distress that entered administration on 28 November 2024. The administrators had pursued the collection of debts—most notably USD 1.5 million owed by Rath-Wood Home and Garden World Limited in County Carlow—and the recovery of stock held by Rath-Wood.

Since the United Kingdom’s exit from the EU, the European Insolvency Regulation no longer applies between Northern Ireland and the State, requiring the Company to seek recognition under the court’s inherent jurisdiction. No direct Irish precedent existed for recognising administrators appointed under the 1989 Order.

The judge concluded that:

The High Court possesses common law and inherent jurisdiction to recognise foreign insolvency proceedings;
There is sufficient equivalence between the administrators’ powers under the 1989 Order and those of liquidators under Part 11 and examinership under Part 10 of the 2014 Act;
Recognition is sought for a legitimate purpose—the realisation of assets and pursuit of legal actions to benefit the Company’s creditors;
The ex parte nature of the application required service on affected parties (in particular Rath-Wood) and liberty to apply on notice.

Accordingly, on 25 March 2025 the court granted the orders recognising the administration and ancillary powers and directed service on interested parties with liberty to apply.

Analysis

Precedents Cited

Apperley Investments & Ors v Monsoon Accessorize Ltd [2020] IEHC 523
Confirmed recognition of UK administrators under the European Insolvency Regulation pre-Brexit without inquiry into the procedure.
Re Mount Capital Fund Ltd (In Liquidation) [2012] IEHC 97
Laffoy J. recognised BVI liquidation orders under the court’s inherent jurisdiction, holding that equivalence between foreign winding-up law and Irish law, plus a legitimate purpose, justified recognition.
Fairfield Sentry Ltd (In Liquidation) v Citco Nederland NV [2012] IEHC 81
Applied similar principles to mount Capital in establishing inherent jurisdiction for non-EU insolvency proceedings.
Cambridge Corporation v Unsecured Creditors [2006] UKPC 26
Privy Council authority on the court’s power to assist foreign bankruptcy and winding-up proceedings.
Re D.D., a Bankrupt [2010] IEHC 546 and Re Flightlease (Ireland) Ltd [2012] IESC 12
Further support for inherent jurisdiction to assist foreign insolvency processes.
Re Bolton [1920] 2 IR 324
Early example of orders in aid in cross-jurisdictional bankruptcy.

These authorities established a two-fold test for inherent recognition: (1) equivalence of jurisdiction and (2) a legitimate purpose.

Legal Reasoning

The court’s reasoning proceeded in three stages:

Jurisdiction: Since the EU Regulation no longer applies post-Brexit, the court relied on common law and its inherent jurisdiction to recognise and assist foreign insolvency office holders.
Equivalence: Detailed comparison of the administrators’ statutory powers under the 1989 Order with those of Irish liquidators (Part 11 of the 2014 Act) and examiners (Part 10). Key analogies included:

Power to bring or defend actions — s. 627(a)(b) vs Schedule 1 para. 6 of the 1989 Order;
Duty to collect and realise assets — s. 624 vs Schedule 1 para. 1;
Continuation of business for creditor benefit — s. 627(c)(d) vs Schedule 1 para. 4(b).

Legitimate Purpose: Recognition was sought to enable the administrators to realise debts and recover stock in the State without procedural delay—an objective aligned with their statutory duty “to achieve a better result for creditors as a whole” under the 1989 Order.

The court thus satisfied both limbs of the Mount Capital test and concluded that granting recognition was both within its inherent jurisdiction and appropriate on the facts.

Impact

This decision will guide cross-border insolvency practice in Ireland by:

Confirming that, post-Brexit, recognition of UK (Northern Ireland) administrators requires recourse to inherent jurisdiction rather than EU Regulation;
Providing a framework for assessing equivalence of foreign procedures—administration, examinership and liquidation—against Irish insolvency law;
Reinforcing the court’s willingness to grant relief ex parte for foreign office holders, subject to service and liberty to apply;
Ensuring that multinational insolvencies maintain momentum in asset recovery and legal enforcement across jurisdictions.

Complex Concepts Simplified

Inherent Jurisdiction: The court’s own common law power to provide assistance to foreign courts and their office holders when no statute applies.
Equivalence Test: A comparative exercise to show that foreign insolvency powers align substantially with Irish insolvency law.
Administration vs. Liquidation vs. Examinership:
- Administration (Northern Ireland): Rescue or better creditor outcome, asset realisation; multi-purpose.
- Liquidation (Ireland): Realisation of assets, distribution to creditors, winding up of the company.
- Examinership (Ireland): Court-supervised rescue of a company as a going concern, only if survival prospects exist.
Ex Parte Application: An urgent application made without notice to affected parties, permissible when immediate relief is required but followed by service and liberty to apply.
Floating Charge Consent: Secured creditors’ approval needed before administration can take effect where a floating charge exists.

Conclusion

The High Court’s judgment in Re: Mercer Agencies Ltd reinforces its inherent common law jurisdiction to recognise and assist foreign (post-Brexit) administration proceedings in Ireland. By applying a clear equivalence test and confirming the legitimacy of the administrators’ purpose, the court has filled the regulatory gap left by the UK’s exit from the EU. This decision will form a cornerstone precedent for cross-border insolvency matters, ensuring that foreign office holders can secure and realise assets promptly for the benefit of creditors across jurisdictions.