“Any unpaid fees or expenses of the Administrators approved by the Administration Creditors Committee as at the Restructuring Plan Effective Date will be paid by the company within 14 days of the Restructuring Plan Effective Date. Any other fees or expenses claimed by the Administrators will be subject to the Adjudication Process and in the absence of agreement with the Plan Administrators the Administrators shall be at liberty to apply to Court for approval in accordance with [IR2016].”
“AND UPON the Court noting that neither clause 8.3 nor clause 10 of the Restructuring Plan interferes with any valid decision made before the Restructuring Plan Effective Date (as defined in the Restructuring Plan) fixing the basis of the Joint Administrators’ remuneration in accordance with theInsolvency (England and Wales) Rules 2016 , but that it is initially a matter for adjudication by the Plan Administrators in accordance with clause 10 whether any such valid decision has been made AND UPON the Court taking the view that, whilst clause 10.2 of the Restructuring Plan is not expressed to be subject to the rights of the Joint Administrators set out in clause 8.3 of the Restructuring Plan, that is clearly the intended effect of clauses 10.2 and 8.3 of the Restructuring Plan AND UPON [NGI] and the company (acting by the Joint Administrators) consenting to an amendment of the Restructuring Plan such that clause 10.2 shall begin with the rider: “Subject always to the rights of the Administrators set out in clause 8.3 of this Restructuring Plan” so as to reflect the intended effect of clauses 10.2 and 8.3 AND UPON the Court taking the view that such amendment will cause no prejudice to stakeholders of the Company, as the amendment merely reflects the clear intended effect of clauses 10.2 and 8.3 of the Restructuring Plan”
“AND UPON the Applicants and the First Respondent agreeing, for the purposes of the Application, that, on30 December 2022 , the creditors in the former administration of the First Respondent resolved that (i) the Applicants were entitled to be remunerated in the set amount of£235,000 , but (ii) that the Applicants retained, or did not relinquish, any right they had to request the creditors to increase the amount of such remuneration”
“The basis of remuneration was fixed by the creditors’ committee on a time cost basis in December 2022…”
“If not fixed as above, the basis of the administrator’s remuneration shall, on his application, be fixed by the court…; but such an application…in any event may not be made more than 18 months after the date of the administrator’s appointment.”
“In my judgment: 42.1 Rule 2.106 applies to remuneration for the services of the administrator “as such”
““administrator” has the meaning given by paragraph 1 and, where the context requires, includes a reference to a former administrator.”
“(1) For the purposes of this Act “administrator” of a company means a person appointed under this Schedule to manage the company’s affairs, business and property.” 42.5 The Rules do not define terms concerning the administrators already defined in the Act and plainly paragraph 111 may apply. However, the simple answer to the submission of Mr Robins is that the context of rule 2.106 (as opposed to the context of his submission) does not require the meaning of administrator to include a former administrator. 42.6 In addition, an extension of rule 2.106 to events after the cessation of office is sufficiently significantly to require and therefore expect express wording to that effect. That is particularly so both because the rule on its face is limited to the period of appointment and because there is no express provision for this possibility within the statutory charge provisions. It may also be noted from paragraph 99(3) of Schedule B1 that Parliament is not slow to refer expressly to “former” when that is considered appropriate. 42.7 There is also the point that it is reasonable to conclude that Parliament would have provided express wording if it had been intended to alter the expected position that a liquidator will decide whether to retain and therefore remunerate former administrators for their services and in doing so continue to control the assets available for distribution to creditors.” ““administrator” has the meaning given by paragraph 1 and, where the context requires, includes a reference to a former administrator.”
“As to the second question, and whether the fact that LBEL has been in liquidation for some time affects the power of the court in this regard or its exercise, Mr Riddiford submitted that, although there is no case law expressly confirming that a former administrator has standing to apply once the company has moved into liquidation, it must be the position that he or she does have such standing. Mr Riddiford emphasised the following points (which I take almost verbatim from his written submissions): (1) First, no restriction is expressed in paragraph 98 of Schedule B1 to the Act such as to prevent a former administrator from making an application under paragraph 98(2)(c). (2) Secondly, paragraph 98(2)(c) is, on the contrary, conspicuously non-prescriptive as regards the question of the standing required to make an application, stating simply that the discharge takes effect “in any case, at a time specified by the court”
“In a case where the administrator is removed from office, a decision of the creditors for the purposes of sub-paragraph (2)(b), or of the preferential creditors for the purposes of sub-paragraph (2)(ba), must be made by a qualifying decision procedure.”
“If a bankrupt or any of his creditors or any other person is dissatisfied by any act, omission or decision of a trustee of the bankrupt’s estate, he may apply to the court; and on such an application the court may confirm, reverse or modify any act or decision of the trustee, may give him directions or may make such other order as it thinks fit.”
“The principles underlying the standing of applicants under section 303(1), and section 168(5), of theInsolvency Act 1986 can be summarised as follows. Creditors have standing where their application concerns their interests as creditors, because the bankrupt’s estate or the assets of the company in liquidation are administered under the terms of the statutory trust for their benefit as creditors. Likewise, where there is or there is likely to be a surplus, the bankrupt or contributories are also persons for whose benefit the estate or assets are being administered and they have standing in respect of their interests in the surplus. Beyond that, there is a limited class of cases where creditors, the bankrupt, contributories or others will have standing, but only in respect of matters directly affecting their rights or interests and arising from powers conferred on trustees or liquidators which are peculiar to the statutory bankruptcy or liquidation regime. Engel v. Peri and In re Hans Place Ltd provide good examples of cases within this category.”
“Mr Brockman referred me to the case of Engel v Perry (sic). There, Ferris J, in the context of bankruptcy, accepted that the court had jurisdiction, either expressly under an equivalent to section 112, or under the court’s inherent jurisdiction, to fix remuneration even where there was a regime for doing so outside of the court’s involvement. It is clear from that decision that the court can fill in gaps that are left by the Rules in circumstances in which the Rules may well not have expressly envisaged the circumstances that exist. That could be considered a good description of this case.”
“The court will take into account whether any application should have been made earlier and if so the reasons for any delay.”
“…whether the court might consider giving fuller reasons for rejecting the submissions made in relation to the decision in [Brilliant](see paragraphs 2, 3, 25-28.3 and 34) in which the Registrar fixed the remuneration of former administrators under applications made under rule 2.106 IR1986 (which was in similar language to rule 18.23) and rule 2.108 (which was in similar language to rule 18.24), even though the creditors had already fixed the administrators’ basis of remuneration by reference to a time costs basis (as here).”
“…(3C) It is for the creditors’ committee (if there is one) to determine - (a) which of the bases [of remuneration] are to be fixed and (where appropriate) in what combination, and (b) the percentage or percentages (if any) to be fixed [where remuneration is fixed on the basis that the administrator will receive as remuneration a percentage of the value of the property with which he has to deal] and the amount (if any) to be set [where the administrator is to be remunerated in a set amount]… (5) If there is no creditors’ committee, or the committee does not make the requisite determination…the administrator’s remuneration may be fixed…by a resolution of a meeting of creditors… (6) If not fixed as above, the basis of the administrator’s remuneration shall, on his application, be fixed by the court…; but such an application may not be made by the administrator unless the administrator has first sought fixing of the basis in accordance with paragraph…(5)…, and in any event may not be made more than 18 months after the date of the administrator’s appointment”