Administrators can seek fee approval post removal

This decision followed last year's decision, whereby the court sanctioned a restructuring plan and ordered that administrators’ appointment ceased to have effect.

Before they were removed from office, the administrators obtained a resolution from creditors approving their charging of fees on an hourly basis and that they could take fees of £235,000 plus VAT on account.

The administrators applied to court, pursuant to the Insolvency Rules for an order that they were entitled to recovery of their fees above and beyond the money on account.

At the final hearing of that application, in addition to the issue as to whether the administrators could apply to court in respect of fees after they had been removed from office, the issue was raised as to whether the former administrators required approval of their additional fees from the court when they already had a fee resolution from creditors.

In light of the fee resolution obtained from the creditors, and the fact that the former administrators were not challenging that the remuneration was insufficient nor that the basis of fixing of the fees was inappropriate, the court found the former administrators had no standing to make the application they were.

Albeit that that decision disposed of the application, the judge went on to consider the position as to whether the former administrators could apply for fee approval from the court, after they had been removed, and concluded that they could.

In regards to Frost v The Good Box Co Labs Ltd [2024] EWHC 422 (Ch).

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