Orthios Eco Parks (Anglesey) Limited, Re
[2024] EWHC 3047 (Ch)
Dolfin Asset Services Limited v Adam Stephens (in his capacity as joint special administrator of Dolfin Financial (UK) Ltd) & Anor.
26 January 2023
[2023] EWHC 123 (Ch)
High Court
A company's client wanted a very detailed bill from the administrators handling its insolvency. The administrators refused, saying it was too much work before the fees were even finalized. The judge agreed with the administrators.
Key Facts
- •Dolfin Financial (UK) Ltd (DFL) was placed into special administration on 30 June 2021.
- •Adam Stephens and Kevin Ley were appointed Joint Special Administrators (JSAs).
- •Dolfin Asset Services Ltd (DASL), a client of DFL, challenged the JSAs' remuneration.
- •DASL requested a line-by-line breakdown of the JSAs' post-appointment time costs.
- •The JSAs refused, citing excessive time and cost, prejudice to the administration, and confidentiality.
- •DASL made two applications to compel disclosure of this information.
Legal Principles
Special Administrators' remuneration is governed by the Investment Bank Special Administration (England and Wales) Rules 2011 (the 'Rules').
Investment Bank Special Administration Regulations 2011 and Rules
Rule 122(1)(f) requires a statement of remuneration charged only if the basis of remuneration has been fixed.
Rules 122(1)(f)
Rule 201 allows creditors/clients to request further information about remuneration or expenses, but this relates to statements required by Rule 122(1)(g) or (h), not a free-floating obligation.
Rules 201
An administrator's decision under Rule 201(2)(b) (to refuse information request) is reviewed for good faith and rationality.
Davey v Money [2018] Bus LR 1903
Compliance with SIP 9 is not sufficient to meet the requirements of Rule 201.
Judge's interpretation of the Rules
Outcomes
The Applications were dismissed.
The court held there was no jurisdiction under Rule 201 to order the disclosure of further information because the basis of the JSAs' remuneration had not yet been fixed. The JSAs' refusal to provide a line-by-line breakdown was deemed rational and not made in bad faith.
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