Validity of appointment made by directors outside court hours

This case is the latest in a line of cases, not all consistently decided, in connection with the validity of out of court appointments of administrators.

The administrators’ application raised questions as to whether paragraph 8.1 of the Insolvency Practice Direction precludes the company or its directors (as opposed to qualifying floating charge holders) from filing notices of appointment outside the court’s usual counter opening hours by using the 24 hour e-filing system and the computation of the 10 business day period for an appointment following filing of notice of intention to appoint.

Notice of intention to appoint was validly filed out of court office hours through the Electronic Working system on 11 October. The first working day thereafter triggering the computation of the 10 business days was therefore Monday 14 October and the tenth working day therefore Friday 25 October. The notice of appointment was filed electronically at 18.00 on 24 October and found to be valid and to take effect from that time.

The judge examined the recent cases on electronic filing of appointments and concluded that there are different rules on electronic filing for a QFCH appointment where the regime in Insolvency Rules 3.20-3.22 must be followed (permitting a QFCH appointment to be made by fax or email) and an appointment made by the company or its directors whom, he concluded, can file electronically by virtue of the effect of Insolvency Rule 1.46 and paragraph 8.1 of the Practice Direction.

The case provides what looks like welcome and sensible clarification, but given the inconsistent decisions, we do recommend legal advice is taken on the administration appointment process!

Jeremy Woodside and Christopher Ratten v Keyworker Homes (North West) Limited [2019] EWHC 3499 (Ch)

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