The UK insolvency regulations allows an alternative fee basis to be used for different tasks within the same insolvency appointment. The fee basis, or combination of bases, set for a particular appointment is/are subject to approval, generally by a committee if one is appointed by the creditors, the creditors themselves via a decision procedure, or the Court.
Further information about creditors’ rights can be obtained by visiting the creditors’ information guide published by the Association of Business Recovery Professionals (R3) at: http://www.creditorinsolvencyguide.co.uk/
Details about how an office-holder’s fees may be approved for each case type are available in a series of guides issued with Statement of Insolvency Practice 9 (SIP 9), which can be found here: https://businesshelpline.uk/fees-and-creditor-guides
When the basis of the office holder’s remuneration has been approved, a periodic report will be provided to any committee and also to each creditor providing a breakdown of the remuneration drawn. If approval has been obtained for remuneration on a time costs basis, (i.e.) by reference to time properly spent by members of staff of the practice at our standard charge-out rates, then the time incurred will also be disclosed, whether or not fees have been drawn, together with the average, or blended rates of such costs.
In line with the legislation, any such report will disclose how creditors can seek further information and challenge the basis on which the fees are calculated and also the level of fees drawn in the period covered by the report. If the office holder’s remuneration for the period covered by the report is not challenged in the period allowed, then that remuneration cannot subsequently be challenged.
Where insolvency appointments commenced before 6 April 2010, there is no equivalent mechanism for fees to be challenged.