Cayman Net News – In a landmark decision the Cayman Islands Court of Appeal has settled various questions on the suspension of redemption. The ruling (December 12, 2008) in the Strategic Turnaround Master Partnership (based in New York) versus Culross Global case specifically defined the meaning of redemption in an investment fund context and at what point a member is actually redeemed from an investment fund.
After examining the articles of association, the Court of Appeal found redemption did not take place on the redemption date but was a process which was not completed until the member’s name was removed from the register of members and the member’s shares were available for re-issue.
Given the investment climate and the rash of redemption requests, the court’s decision is important to directors, administrators, auditors, legal advisers and other third parties involved in the determination of the rights and liabilities of investment funds and investors.
