The High Court has directed the official liquidator of Denis Finn Limited to provide the Revenue Commissioners with a detailed breakdown of his fees before the court considers his application for final orders in the liquidation.
In a judgment delivered on 21 December 2016, Mr Justice David Keane ordered David Hughes to furnish the breakdown sought by the Revenue. The court said the material was needed so the Revenue, as a significant creditor, and the court could assess whether the remuneration claimed was reasonable.
Hughes was appointed liquidator in June 2008. He sought approval to retain a further €93,004 from company assets for work between October 2013 and the conclusion of the liquidation. He had already received €465,746.76 in interim fee payments. If the further sum were allowed, his total remuneration, expenses and VAT would be €558,750.76.
The Revenue opposed approval of the further payment, arguing that the information supplied did not adequately support the claim and that the fees were too high. It requested task-by-task details, including who completed each task, their grade and hourly rate, and the time spent. Hughes supplied a summary dividing his work across seven areas, including administration, tax, creditors, a professional negligence claim and a client dispute. He maintained that the report appendix gave at least as much detail as time sheets and did not propose to provide them.
The judge accepted that time sheets are not routinely required in every liquidation. The level of documentation should depend on the circumstances and should not impose disproportionate work or expense on creditors. But, in this case, the Revenue disputed whether the existing information was sufficient, and without the requested time sheets it could not assess the fees. The court also had no evidence that producing them would cause further or disproportionate expense.
The judge said it was for Hughes to satisfy the court that the remuneration sought was reasonable; the Revenue did not have to prove that any part was unreasonable. He did not decide the Revenue’s separate challenge to the level of fees. That issue was premature until the requested breakdown had been reviewed.
The court directed Hughes to provide the breakdown and said it would hear the parties on deadlines for producing and considering the material. The application for final orders was adjourned to a later date for mention. The judgment did not determine the final fee entitlement or bring the liquidation to a close.