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Recovery of Trustee's Costs

Recovery by a Trustee of his costs can often be problematic. This may be particularly so where the bankrupt has managed to obtain an annulment. Whilst the recent case of “Appleyard v Wewelwala” [2012] has clarified the right of a Trustee to recover his costs, at least up until such time as he became aware of the application for an annulment, there still remains the potential hurdle of Rule 6.142, and the right of the bankrupt (with permission) to challenge a Trustee’s costs as being excessive. The Court has shown a tendency to favour proportionality rather than justification, and has applied the guidelines within the Practice Statement (Fixing and Approval of Remuneration of Appointees) [2004]; see “Brook v Reed” [2011]. Trustees should therefore be mindful of “proportionality” in terms of their likely costs in the administration of any estate, particularly if there is likely to be an annulment or otherwise a surplus in recovery.

For further information on this topic please contact Chris Millar either by telephone on 01306 502225 or by email: c.millar@downslaw.co.uk.

Posted on 08/04/2013 by Pam Bowring

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