Matthew James Cowlishaw & Ors. v Octopus Energy Retail 2022 Limited
[2022] EWHC 3105 (Ch)
In the matter of: Bulb Energy Limited (In energy supply company administration)
9 June 2023
[2023] EWHC 1647 (Ch)
High Court
Bulb Energy went bankrupt. The people who managed its finances while it was going bankrupt asked for a lot of money for their work. An expert checked if that was fair, and said it was, so the judge agreed.
Key Facts
- •Bulb Energy Limited, an energy supply company with 1.5 million customers, was placed into special administration on 24 November 2021.
- •Administrators sought court approval for £24,969,221 (plus VAT) in remuneration and £3,181,920.67 (plus VAT) in pre-appointment costs.
- •BEIS (Department for Energy, Security and Net Zero) funded the administration and had already approved the administrators' remuneration and costs.
- •An independent assessor, Mr. Russell Downs, was appointed to review the reasonableness of the fees.
- •Mr. Downs concluded that the remuneration and pre-appointment costs were fair, reasonable, and commensurate with the work undertaken.
Legal Principles
The objective of an energy supply company administration is to secure the continuation of energy supplies at the lowest reasonably practicable cost.
Energy Act 2011, s.95(1)(a)
Administrators' remuneration is to be fixed by reference to the time properly given in attending to matters arising in the administration.
Energy Supply Company Administration Rules 2013, r.76(1)-(3)
The court must have regard to certain matters when fixing remuneration (complexity, exceptional responsibilities, effectiveness, value and nature of property).
Energy Supply Company Administration Rules 2013, r.76(5)
In ordinary administrations, remuneration should be fair, reasonable, and commensurate with the nature and extent of work properly undertaken.
Insolvency Practice Direction, para. 21.2
Court approval is needed for pre-appointment costs incurred by the administrator before the energy supply company entered administration.
Energy Supply Company Administration Rules 2013, r.37
Outcomes
The court approved the administrators' remuneration of £24,969,221 plus VAT and pre-appointment costs of £3,181,920.67 plus VAT.
The independent assessor's report concluded the fees were fair, reasonable, and commensurate with the work; BEIS, the primary economic stakeholder, had also approved the amounts; the work facilitated the continuation of energy supply.
Similar Cases
MTA Personal Injury Solicitors LLP (in administration) v Steven Wiseglass
[2024] EWHC 2208 (Ch)
British Gas Trading Limited, R (on the application of) v Secretary of State for Energy Security and Net Zero
[2023] EWHC 737 (Admin)
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.
[2023] EWHC 123 (Ch)