The High Court has reduced the fees charged by a liquidator who was promoted during the liquidation process and increased his fees on that basis.
The court was told that Declan Taite, of RSM Farrell Grant Sparks (FGS), was paid an hourly rate of €275 per hour between July and December 2005, for his work on the liquidation of a company called Mouldpro International Ltd.
At the time he was a director of the FGS and Pearse Farrell,of that firm, had been appointed liquidator of Mouldpro.
From January 1st, 2006, Mr Taite was listed as a partner with FGS and claimed an hourly rate of €350 per hour. In 2007 his rate was increased to €375 per hour and, in 2009, to €405 per hour.
From April 1st, 2009, Mr Taite’s hourly rate was reduced to €365, the maximum allowed for a partner by Mr Justice Peter Kelly in re ESG.
“In the years 2006 to 2009, other individuals with the status of director worked on the liquidation at hourly rates of between €275 and €310,” Ms Justice Finlay Geoghegan said in a previously unreported judgment last month.
Rate of remuneration
The case involved a challenge by Plastronix Investments Ltd to the rate of remuneration being charged by FSG for its work in the liquidation of Mouldpro.
“The increase in the hourly rate between December 31st, 2005, and January 1st, 2006, from €275 to €350, ie €75, is an increase of 27.2 per cent,” the judge noted.
She said there had been a similar issue with Mr Taite’s colleague, Seán Carr, who began working on the liquidation as a senior assistant but progressed to being an executive, a manager, and a senior manager, with the progression accompanied by increases in his hourly rates.
“Notwithstanding the experience and abilities of Mr Taite in 2006, it is not credible that, by reason of his promotion in the firm, the unit value of the work done by him in this liquidation increased by a factor of more than 25 per cent.”
The judge reduced Mr Taite’s rate by €30 an hour for all hours since January 1st, 2006, being a total of 424 hours and a consequent reduction of €12,720.
In the case of Mr Carr she proposed a reduction of €20 an hour for all hours since January 1st, 2009, being 240 hours, or €4,800.
