In exercising their role, functions, duties and powers, insolvency office-holders are under a duty to take reasonable care in their management of the estate's affairs, not to make a secret profit and not to act when they have a conflict of interest.
An office-holder must act in the best interests of creditors as a whole, subject to some limited exceptions, and as such must exercise a high standard of care and skill. They must always act impartially and independently.
For further reading on the roles, powers and duties of insolvency office-holders, see: Roles, powers, duties and functions of an insolvency office-holder—overview.
An administrator has wide powers and discretion in the conduct of an administration and, as a result, the courts are generally reluctant to interfere with the conduct of the administration unless absolutely necessary. However, there are occasions when an administrator's conduct may need to be challenged.
A creditor or a member of a company in administration may apply to court under paragraph 74 of Schedule B1 of the Insolvency Act 1986 (IA 1986) claiming that:
the
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