Cayman Update: Separate Liquidation Committees for Segregated Portfolios of SPCs On 19 April 2021, Chief Justice Smellie QC held in In the Matter of Premier Assurance Group SPC Ltd. (in Official Liquidation) that the Court has the power under Order 9, rule 1(1) of the Companies Winding Up Rules, 2018 ("CWR") to order the establishment of separate liquidation committees in respect of a segregated portfolio company ("SPC") and each of its segregated portfolios.There are no specific statutory provisions in the Companies Act (2021 Revision) (the "Companies Act") or the CWR empowering the Court to establish separate liquidation committees in respect of an SPC and its portfolios. Notwithstanding this, the joint official liquidators ("JOLs") of Premier Assurance Group SPC Ltd (in Official Liquidation) (the "Company") submitted that the Court had the power to make such a direction pursuant by way of the proviso in O.9, r.1(1) of the CWR, which provides that:"Unless the Court otherwise directs, a liquidation committee shall be established in respect of every company which is being wound up by the Court" (emphasis added)The JOLs submitted that pursuant to certain case law, the Court had the power to order that separate liquidation committees be formed as long as they were compliant with the requirements of the CWR. Furthermore, the establishment of separate liquidation committees would be entirely consistent with the statutory scheme prescribed by the Companies Act relating to SPCs and, in particular, Section 223(1)(a) of the Companies Act. By that provision, the legislature mandates that liquidators deal with the assets of a SPC in accordance with Section 219(6) by establishing and maintaining procedures to ensure that the assets of each segregated portfolio are segregated and separately identifiable from the assets of other portfolios and from the SPC's general assets. Following from this, it seemed appropriate from an economic and practical perspective that only those creditors with recourse to certain assets of the Company (i.e. by reference to a segregated portfolio) should have an ability to provide feedback in respect of those assets.In the circumstances, the Court accepted that a direction for the establishment of separate liquidation committee could be made in respect of SPCs pursuant to O.9, r.1(1) of the CWR and that it was appropriate in this case for liquidation committees to be established in respect of the Company and each of its segregated portfolios.Rupert Bell (Partner), Chris Keefe (Senior Counsel) and Daisy Boulter (Associate) of Walkers act for the JOLs.