The case of In the matter of CB Constructions (NSW) Pty Ltd [2014] NSWSC 913 provides a timely reminder that even when there is no opposition to an application to the Court for approval of liquidator remuneration, the amount of remuneration may not simply be fixed as a matter of course.
In this case a provisional liquidator was appointed and three weeks later, he was appointed liquidator. He then applied to the Supreme Court of NSW for court approval for his remuneration during his time as provisional liquidator.
In this matter, there were a number of issues including:
- inconsistencies in the amount of remuneration sought;
- the supporting affidavit provided to the court had not been served on contributories in accordance with the Supreme Court (Corporations) Rules; and
- the supporting affidavit failed to establish, in accordance with the Corporations Act, that the remuneration was reasonable.
As a result, the Court refused to approve the remuneration and dismissed the claim.
While an application for court approval of remuneration can be costly and preparing evidence time consuming, the risk of a liquidator going unpaid despite there being assets to meet fees is a far worse outcome.
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