INS48180 - Legal background: Statements of Insolvency Practice: What does SIP 9: ‘Remuneration of insolvency office holders’ say?

The SIP ( click here to see a full copy) is aimed at ensuring liquidators involve creditors in decisions on the liquidators’ fees, and that creditors are aware of their rights in relation to decisions on fees. The following are the most relevant sections.

• Liquidators should ensure adequate steps are taken to bring the rights of creditors in relation to fees to the creditors’ attention. This is done by liquidators being required to send guidance notes to creditors at the beginning of a liquidation (paragraph 3.1).
• Because liquidators control the funds with which they pay themselves, it is ‘of primary importance’ they disclose and explain these fees to the creditors. This is done by requiring the liquidator to provide sufficient supporting information to enable the creditors to form a judgement as to whether the proposed fee is reasonable having regard to all the circumstances of the case (paragraph 3.2).

So if you are not satisfied the fee is good value, you can require the liquidator to provide you with further evidence to satisfy you the fee is reasonable (see INS42100).