Reid & Anor, Re Audit of their Intromissions [2008] ScotCS CSOH_56 (28 March 2008)

Reid & Anor, Re Audit of their Intromissions [2008] ScotCS CSOH_56 (28 March 2008)

A total sist of the winding up of Arakin Limited is appropriate once security of £1,000,000 is provided for the Joint Liquidators' remuneration, outlays, and future expenses, as this safeguards their interests while allowing the company to be returned to its shareholders. The applications for fixing remuneration and discharge can proceed after the sist, with security ensuring the liquidators are not left unprotected.

Citation
[2008] ScotCS CSOH_56
Parties
Joint Liquidators / Noters: John Charles Reid and James Bernard Stephen (Deloitte & Touche LLP); Respondents / Shareholders (and Alleged Creditor): Mr and Mrs McNamara
Jurisdiction
Scotland
Judgment Date
28 March 2008
Procedural Posture
Audit of Intromissions / Liquidation Proceedings / Interlocutory Application for Sist (stay) of Winding Up, Fixing of Remuneration, and Discharge of Liquidators
Outcome
Application for sist of winding up granted, subject to provision of security; directions given for further procedure.
Legal Topics
Winding Up of Companies, Liquidator's Remuneration, Discharge of Liquidators, Sist (stay) of Liquidation, Security for Expenses
Insolvency Law Company Law Winding Up of Companies Liquidator's Remuneration Discharge of Liquidators Sist (stay) of Liquidation Security for Expenses

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Parties

John Charles Reid and James Bernard Stephen (Deloitte & Touche LLP)

Joint Liquidators / Noters

Mr and Mrs McNamara

Respondents / Shareholders (and Alleged Creditor)

Procedural Posture

Audit of Intromissions / Liquidation Proceedings / Interlocutory Application for Sist (stay) of Winding Up, Fixing of Remuneration, and Discharge of Liquidators

Legal Issues

  1. 1 Whether the winding up of Arakin Limited should be sisted (stayed) before the liquidators' remuneration and discharge are determined
  2. 2 What security is appropriate for the liquidators' claims and expenses if the winding up is sisted
  3. 3 Whether a partial or total sist is appropriate under s.147 of the Insolvency Act 1986

Ratio Decidendi

A total sist of the winding up of Arakin Limited is appropriate once security of £1,000,000 is provided for the Joint Liquidators' remuneration, outlays, and future expenses, as this safeguards their interests while allowing the company to be returned to its shareholders. The applications for fixing remuneration and discharge can proceed after the sist, with security ensuring the liquidators are not left unprotected.

Court Disposition

Application for sist of winding up granted, subject to provision of security; directions given for further procedure.

Orders

  • Joint Liquidators permitted to proceed with applications for fixing outlays/remuneration and for discharge from liability.
  • Joint Liquidators to submit accounts and claims within three months.