Article by Robert Briant of Conyers Dill &
Pearman
The offshore hedge fund industry has typically suffered from a
lack of relevant offshore case law. This has changed. While many
offshore hedge funds have collapsed in the recent financial crisis,
the positive result has been a plethora of offshore hedge fund
cases in each of the British Virgin Islands, the Cayman Islands and
Bermuda. Each case turns on the specific facts, constitutional
documents and statutory framework of the fund in question. However,
this article examines some of the general principles that can be
derived from these cases as they relate to British Virgin Islands
law.
Almost all of the cases had a common fact pattern. Typically an
investor had submitted a redemption request while the fund was in
crisis, usually experiencing liquidity issues or perhaps the fund
was a victim of fraud, such as the Madoff or Petters fraud. Usually
shares were redeemed on a relevant dealing day, but the proceeds
