Jurisdiction(s):
United Kingdom

High Court varies administrator remuneration order for SIP 2 non-compliance and inadequate disclosure under IR 2016 r 12.59 (MTA Personal Injury Solicitors LLP v Wiseglass, England and Wales)

Published on: 01 November 2024

Published by a LexisNexis Restructuring & Insolvency expert

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Article summary

MTA Personal Injury Solicitors LLP (in administration) (acting by its joint administrators Andrew Lawrence Hosking and Sean Bucknall) v Wiseglass [2024] EWHC 2208 (Ch) What are the practical implications of this case?

The burden rests on the administrator, as an office-holder owing fiduciary duties, to substantiate any request for remuneration by being candid with the court and providing information that is adequate, coherent and sufficient. The administrator must justify fees with proper evidence and open disclosure.

Statement of Insolvency Practice (SIP) 2 is pivotal in underscoring the duty to identify assets, including prospective claims against third parties such as directors, and to determine what recoveries may realistically be achieved.

Paras 9–11 require an initial assessment: this includes making enquiries and/or interviewing directors and senior staff where appropriate, forming a preliminary view on potential recovery routes, and deciding what further investigation is warranted.
Paras 4 and 18 emphasise clear reporting of actions taken and outcomes, together with thorough documentation of initial assessments, investigations and conclusions.

An administrator who does not adhere to these evidential standards, or who fails to supply a proper level of information when seeking remuneration, is exposed to liability...

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