Cayman Islands Fund Finance Update: A Potential Respite From Padma?

The Padma Decision

As many in the industry are aware, the October 2021 decision of the Grand Court of the Cayman Islands in Padma¹ has resulted in some uncertainty on the proper process for bringing proceedings against Cayman Islands exempted limited partnerships ("ELPs"). Specifically, based on a somewhat novel reading of the Exempted Limited Partnership Act, the judgment held that a creditor's winding up petition must be brought, not against the ELP itself, but through the prism of its general partner. The judgment also expressed the view that all legal proceedings against an ELP (i.e. not merely winding up petitions) must be brought against the general partner.

In the fund finance space, given that: