High Calibre thoughts on extensions of time

High Calibre thoughts on extensions of time

In what circumstances will the court exercise its discretion to extend the time limit to challenge the remuneration and expenses of appointed administrators? James Morgan and Matthew Weaver, barristers at St Philips Chambers, take a look at the decision in Re Calibre Solicitors Ltd and highlight the lessons lawyers should learn from this case.

Original news

Re Calibre Solicitors Ltd (in administration) [2014] Lexis Citation 259, [2014] All ER (D) 187 (Dec)

An application was made under the Insolvency Rules 1986 (IR 1986), r 2.109 to challenge the remuneration and/or expenses of appointed administrators on the ground that they were excessive. The issue was whether that application, in addition to challenging remuneration detailed in a first report, could also challenge remuneration and/or expenses detailed in a second progress report, or whether a second application and an extension of time to make it were required. Mr Registrar Jones held that, on the true construction of the IR 1986, the eight-week period within which to challenge remuneration and expenditure applied to the specific report which detailed the remuneration and expenses challenged. Accordingly, the company could not rely upon the first report to challenge the remuneration and expenses detailed in the second report. A second application was required and the court granted an extension of time in which to make it.

What was the background to the application briefly?

Administrators were appointed in respect of Calibre Solicitors Ltd. Their first progress report to creditors was dated 6 September 2013 and, within the eight-week time limit, on 31 October 2013 a creditor (JC) issued an application under IR 1986, r 2.109 to challenge the remuneration and expenses set out therein as 'excessive'. The administrators' second progress report was dated 5 February 2014. On 13 June 2014, JC issued a second application to challenge the remuneration and expenses on the same grounds. The second application was made well outside the eight-week time limit prescribed by

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About the author:

Stephen qualified as a solicitor in 2005 and joined the Restructuring and Insolvency team at Lexis®PSL in September 2014 from Shoosmiths LLP, where he was a senior associate in the restructuring and insolvency team.

Primarily focused on contentious and advisory corporate and personal insolvency work, Stephen’s experience includes acting for office-holders on a wide range of issues, including appointments, investigations and the recovery and realisation of assets (including antecedent transaction claims), and for creditors in respect of the impact on them of the insolvency of debtors and counterparties.