Q&As

Where proceedings are ongoing and the defendant enters creditors’ voluntary liquidation but the liquidators refuse to settle proceedings (drop hands) without payment of their costs to date, is there any authority for getting paid costs as an expense of the liquidation or attaching personal liability to the liquidators for future costs? Re Wenborn does not help as it only provides for payment of costs from the company's assets but in this case, the liquidators are adopting the proceedings where the claimant has offered drop hands.

read titleRead full title
Published on LexisPSL on 05/06/2019

The following Restructuring & Insolvency Q&A provides comprehensive and up to date legal information covering:

  • Where proceedings are ongoing and the defendant enters creditors’ voluntary liquidation but the liquidators refuse to settle proceedings (drop hands) without payment of their costs to date, is there any authority for getting paid costs as an expense of the liquidation or attaching personal liability to the liquidators for future costs? Re Wenborn does not help as it only provides for payment of costs from the company's assets but in this case, the liquidators are adopting the proceedings where the claimant has offered drop hands.

Where proceedings are commenced against a defendant company that subsequently goes into liquidation, that company remains the relevant party in those proceedings and the liquidator is not substituted in their place. See Practice Note: What effect does an insolvency process have on ongoing litigation and arbitration proceedings?

With respect to the costs of the proceedings, the general provisions of the CPR apply (see the Insolvency (England and Wales) Rules 2016 (IR 2016), SI 2016/1024, r 12.1(1)).

The usual rule is that costs will be awarded against the unsuccessful party. It is an established princip

Popular documents