LISA KELLY DEVINE (DECEASED)

TRUSTEES REPORT TO UNSECURED CREDITORS

PURSUANT TO SECTION 331 OF THE INSOLVENCY

ACT 1986

This document may not be copied , reproduced , republished , downloaded , posted , broadcastor transmitted in any way except for your own personal use . Prior consent must be obtainedfor any other use of this materi al .

Rule 6 . 81 ,6 . 127 , 6 . 129 ,6 . 137

( a ) de lete asappl i cab le( b ) Insert re l evantsection

(c) Insert date andtime by which proxyis to be lodged whichshould be not morethan 4 days beforethe date fixed for themeeting

Notice to Creditors of Meetingof Creditors

Form 6 . 35

IN ADMINISTRATION OF INSOLVENT ESTATE OF DECEASEDPERSON

Lisa Kelly Devine (Deceased)

A meeting of creditors has been summoned by the Trustee

The meet i ng w i ll be he ld as follows :-

Date 8 July 2014

Time 10 : 00am

Place 10 Orange StreetHaymarket

A proxy fo rm i s enclosed which must be lodged with me not later than 12 : 00pm on7 July 2014

to entitle you to vote Idebt form if you have

Dated

S igned

TrusteeS B RYMANShipleys LLP10 Orange StreetHaymarketLondonWC2H 7DQ

NOTE : Insert any further details which by the nature of the meeting need to bestated.

oxy at the meeting [together with a completed proof ofalready lodged one].

Software Supplied by Turnkey Computer Technology Limited , Glasgow

gh pi le LLP

Chartered Accountants & Professional Business Advisers

To All Known Creditors

Dear Sirs

10 Orange Street , HaymarketLondon WC2H 7DQ

DX - 40001 Covent Garden

T + 44 (0) 20 7766 8560F + 44 (0) 20 7312 0022E advice@shipleys .com

www .shipleys .com

Our Ref : SBR/511 1 8/GLI

Please call : Greg LishakE : lishakg@ s hipl e ys .com

5 June 2014

Notice to Creditors of Final General Meeting of Creditors

Lisa Kelly Devine (Deceased)(Subject to an Administration of Insolvent Estate of Deceased Persons Order)In The Croydon County Court No 1007 of 2009

A final general meeting of creditors has been summoned under Section 331 of the Insolvency Act1986 for the purposes of :

1. receiving my report of the administration of the estate, and2. any other business including matters provided by Section 331(2) of the Insolvency Act

1986.

The meeting will be held at Shipleys LLP , 10 Orange Street , Haymarket , London WC2H 7DQ on8 July 2014 at 10 a . m . A proxy form is enclosed which should be l odged with me not later than12 : O0hrs on 7 July 2014 to entitle you to vote by proxy at the meeting . The meeting is a formalrequirement and you should kindly inform me in advance if you propose to attend .

Receipts and Payments

I enclose a summary of my receipts and payments for the entireTrustee and I have reconciled my account with that held by thethe Admin i stration of the Insolvent Estate of the Deceased .

Trustee ' s Report

Term Assurance Policy

period of my administration asSecretary of State in respect of

Following my appointment an exchange of correspondence with Nationa l Westminster Bank P l c( ' Natwest' ), the broke r of the policy taken out with Aviva Limited (Aviva ' ) , determ i ned that thepolicy was held in the name of the company DNM Limited (` DNM '), a Company for wh ich thedeceased was a Director , on the life of the deceased . It was stated that the benefits belonged to

Offices : London and Godalming

Principals - Chartered Accountants : Ken Roberts ( Ma nag i ng ), Stewart Je ll, Steve Jobems , Joe K i nton , Shane Moloney , Simon Rob i nson, Steve Ryman , Jay Sangh raj ka .

Others : Ben Bidne l l , Nancy C ru i ckshanks , Anthony Da vi dson , Steve Foste r, Fio n a Ha rper , M i ke Lu ckett , Tony M i tchel l.

A member of AGN Internat i ona l L i m i ted . An assoc i at i on of separate a n d i ndependent account i ng and consu l t in g f rms .Reg u lated by the Inst i tute of Chartered Accountants i n Eng land and Wa l es fo r a range of investment bus i ness act i v i ties .

Shipleys LLP is a l im i ted l iab ili ty part nersh i p , reg i stered number OC317129 i n Engla nd & Wa l es , reg i stered office 10 O range Street , Haymarket , Lo ndon WC2H 7 DQ

www .shipleys .com

DNM and I obtained a full copy of the policy and all of its terms in November 2010 and providedthe insurers with the final death certificate.

Correspondence took place with Aviva and NatWest regarding the fact that the deceased was theDirector and Shareholder of DNM which was dissolved , and evidence was provided to theinsurers regarding the dissolution . After considering this matter and corresponding regarding th i s ,advice was taken and it was decided that , as there appeared to be creditors of DNM , it was notpossible to simply pass the proceeds onto the deceased estate on the basis that the deceasedwas the shareholder .

In March 2012 I wrote to the creditors of DNM as it appeared that DNM would need to be restoredin order to realise the proceeds of the policy and that DNM would be the beneficiary . Thecreditors were asked whether they would agree to me applying for the restoration of DNM atCompanies House if the costs were covered by the estate plus action taken to wind up DNM inreturn for the agreement that one third of the policy be made available to the insolvent estate withthe balance remaining in the liquidation of DNM . Creditors were chased and approval waseventually received from the creditors to this proposal in November 2012 .

An application was made for the restoration of DN M and DNM was restored on 28 November2012. On 16 January 2013 a petition was presented to the Court and on 28 February 2013 DNMwas wound up.

Following the winding up of DNM the Official Receiver dealt with matters until, on 24 April 2013,Neil Bennett of Leonard Curtis was appointed Liquidator. He took steps to realise the proceedsfrom the Aviva policy and as you can see from the enclosed receipts and payments account asum of £33,380.96 was received into the deceased estate in July 2013.

Travel Insurance Policy

Following my appointment, the insurance company, AXA Insurance Limited, were contacted andin response confirmed that they would be unable to pay out any sums following the death of thedeceased due to the circumstances outlined in the final death certificate and clause 8 of theexclusions section of the policy. Therefore, as you can see from the attached receipts andpayments account, no funds have been realised in relation to this.

Cash at Bank

The deceased held an account with NatWest , who were contacted following my appointment inorder to request the balance of the account be transferred . On 19 October 2011 a sum of£1 , 922 . 43 was received .

ISA Interest

As you can see from the attached receipts and payments account , a sum of £34 . 20 has beenreceived in relation to ISA interest during the Administration of the Insolvent Estate of theDeceased .

Page 2 of 5

www.shipleys .com

Bank Interest

As you can see from the attached receipts and payments account, a sum of £9.59 has beenreceived in relation to bank interest during the Administration of the Insolvent Estate of theDeceased.

Payments

Official Receiver' s Remuneration

I can confirm that the Official Receiver's outstanding remuneration totalling £1,355.00 has beensettled in full from funds held in the Estate.

DTI Cheque Fee

I have incurred fees in this regard totalling £7.70. These charges are incurred every time I amrequired to raise a cheque from the Insolvency Services Account ('ISA').

Secretary of State ( ' SOS ') Fees

I advise that the SOS charge a fee for any realisations made in the Administration of the InsolventEstate of the Deceased and that are paid into the ISA. I confirm that the sum of £5,728.98 hasbeen charged in this matter and has been deducted by the Insolvency Service upon deposit ofeach remittance.

Professional Fees

I can confirm that a sum of £705.00 has been paid to Alexander's Strategic Planning Limited inrelation to locating and reviewing information regarding DNM in order to determine it's financialposition.

Tax on ISA Interest

I advise that all interest that has been accrued on the ISA is subject to tax, which is deducted atsource. I confirm that the sum of £7.23 has been deducted in this regard.

Legal Fees and Disbursments

I confirm that DWF LLP have been paid fees and disbursements the sum of £1,897.33 and£16.60 respectively, for their assistance in restoring DNM.

In addition, a sum of £500.00 has been paid to Isadore Goldman Solicitors Limited for adviceprovided in relation to issues raised by the mother of the deceased debtor.

VAT

A sum of £4,602.39 has been deemed irrecoverable as the deceased debtor was not registeredfor VAT.

Page 3 of 5

www.shipleys . com

Bank Charges

I advise that the Insolvencywhich is deducted at sourcecharges totalling £334 . 00 .

The Treasury Solicitor

Service levy a quarterly bank charge for the use of the ISA account. I confirm that to the date of this report the ISA has incurred bank

A sum of £300 . 00 has been paid to the Treasury Solicitor , which was required in order for DNM tobe restored .

Trustee ' s Remuneration

Statement of Insolvency Practice No . 9 requires Trustees to provide certain information tocreditors regarding time spent on the Administration of the Insolvent Estate of the Deceased . Inaccordance with these requirements , I would advise creditors that to date , both I , and my staff ,have spent a total of 176 hours and 28 minutes on the administration of this case , incurring time

costs in the sum of £30 , 900 . 29 , giving rise to an average hourly charge out rate of £175 . 11 . Iadvise that to date I have drawn remuneration totalling £17 , 557 . 37 on account in respect of mytime costs .

I would further advise creditors that should they require a more detailed analysis of this time ,they should adopt the procedure as set out in Section 9 of Statement of Insolvency PracticeNo . 9 , which is attached to this report for your information .

In accordance with the resolution duly passed at the Meeting of Creditors on held 23September 2013 , creditors will no doubt recall that the I was authorised to draw remunerationon account of time costs , at my discretion .

Trustee ' s Disbursements

Where disbursements are recovered in respect of precise sums expended to third parties there isno necessity for these costs to be authorised . These are known as category 1 disbursements . Itherefore report that the sum of £2 , 197 . 83 has been incurred and drawn in respect of category 1disbursements as follows :

Disbursement Amount £Insurance 126.00Advertisin 84.60Searches 143.70Leg al 1,815.00Posta e & Couriers 28.53Tota I 2 , 197 . 83

Trustees often charge expenses for example , stationery , photocopying charges , telephone andfax cost . Such expenses , which are attributable to cases , require the approval of the creditorsbefore they can be drawn and these are known as category 2 disbursements . I can confirmthat during the entire period of the Administration of the Insolvent Estate of the Deceasedcategory 2 disbursement expenses in the sum of £137 . 75 have been incurred (and drawn) asfollows :

Page 4 of 5

www .shipleys . com

Disbursement Amount £Photoco in 137.75Total 137 . 75

Financial Outcome

After providing for the costs of the Administration of the Insolvent Estate of the Deceased , thereare no funds to enable a distribution to any class of creditor .

The Administration of the Insolvent Estate of the Deceased is for practical purposes complete .

If at this stage you require any further information do not hesitate to contact me Greg Lishak whohas assisted me with the administration of the case .

Yours

StephMfRymanTrustee

Ant h ony Davi d so n a n d Robert Sma iles are lice nsed to act a s I nsolvency P ract it i on e rs in th e U ni ted Kingdom by t he I nsolve ncyP ra ctit io ne rs Associ ation a n d Stephen Ryman is lice nsed to act as a n I nsolven cy P ra ct i t ion e r in th e U nited Kingdom by theAss oci atio n of Cha rte red Cert ifi ed Acco u nta n ts

Page 5 of 5

Lisa Kelly Devine (Deceased)

Trustee 's Abstract of Receipts & Payments

Statementof Affairs

ASSET REALISATIONS89 , 598 . 00 Term Assurance Policy16 , 000 . 00 Travel Assurance Policy

1 , 935 . 00 Cash at BankISA interestBank Interest Gross

COST OF REALISATIONSOR . RemunerationDTI Cheque FeesSec of State FeesOffice Holders FeesOffice Holders ExpensesProfessional FeesTax on ISA interestLegal FeesLegal DisbursementsVATBank ChargesThe Treasury Solicitor

UNSECURED CREDITORS(170,167.00) Shortfall on repossessed property(52,000.00) HM Revenue & Customs(77,210.00) Other(7,416.00) Banks Overdraft(3,654.00) Domestic

(202,914.00)

REPRESENTED BY

Note :

From 29/07/2009To 05/06/2014

33 , 380 . 96NIL

1 , 922 . 4334 . 209 . 59

35 , 347 . 18

1 , 355 . 007 . 70

5 , 728 . 9817 , 557 . 372 , 335 . 58705 . 00

7 . 232 , 397 . 33

16 . 604 , 602 . 39334 . 00300 . 00

(35 , 347 . 18)

NILNILNILNILNILNIL

( 0 . 00 )

From 29/07/2009To 05/06/2014

33 , 380 . 96NIL

, 1 , 922 . 4334 . 209 . 59

35 , 347 . 18

1 , 355 . 007 . 70

5 , 728 . 9817 , 557 . 372 , 335 . 58705 . 00

7 . 232 , 397 . 33

16 . 604 , 602 . 39334 . 00300 . 00

(35 , 347 . 18)

NILNILNILNILNILNIL

( 0 . 00 )

N IL

Trustee

Page 1 of 1 1 PS SQL Ve r. 2 01 2 . 1 0 03 Ju n e 201 4 1 2 : 4 1

Case - Lisa Kelly Dev i ne

Trus tees' time costs for the pe ri od 31 / 72/2009 to 05/06/2014

Partne rTi me Cos

Admi n i strati on and PlanningCase Planning 125Administrative Set Up 0.00Appointment notification 0.00Maintenance of Records 320Statutory Reporting 0.00

Realisa ti on of AssetsIdentifying, Securing, Insuring 0.00Retention of Title 0.00Debt Collection 1.00Sales-property, business &assets 1.00

Cred i torsCreditors - Communication with 1.50Creditors Claims 0.00

I nvestiga ti onsSIP2 Review 0.00CDDA Reporting 0.00Antecedent Transactions 0.00

TradingManagement of Operations 0.00Accounting for Trading 0.00Ongoing Employees 0.00

TaxTax 0 00

7 . 95Average hourly charge out rate £487.45

Total Hours 176 .46Tota l Cost £30 , 900 . 29Average £ 175 . 11

£603 . 75 7 . 05 £2 , 814 . 60 0 . 00£0 . 00 0 . 00 £0 . 00 0 . 00£0 . 00 0 . 00 £0 . 00 0 . 00

£1 , 569 . 00 4 . 45 11 , 211 . 15 0 . 00£0 . 00 1 . 10 £32520 0 . 00

£0 . 00 020 £54 . 00 0 . 00£0 . 00 0 . 00 £0 . 00 0 . 00

£480 . 00 0 . 00 £0 . 00 000£480 . 00 1 . 20 £375 . 20 0 . 00

£742 . 50 170 £536 . 30 O . OO£0 . 00 3 . 40 £1 , 051 . 00 0 . 00

£0 . 00 0 . 00 £0 . 00 0 . 00£0 . 00 0 . 00 £0 . 00 0 . 00£0 . 00 0 . 00 £0 . 00 0 . 00

£0 . 00 000 £0 . 00 0 . 00f0 . 00 0 . 00 £0 . 00 0 . 00£0 . 00 0 . 00 £0 . 00 0 . 00

£0 . 00 0 . 00 £0 . 00 0 . 00

£3,875.25 19.10 £6,367.45 0.00£333 . 37 #DIV/01

£0 . 00 0 . 00 £0 . 00

£0 . 00 0 . 30 £66 . 00£0 . 00 0 . 00 £0 . 00

£0 . 00 0 . 00 £0 . 00£0 . 00 0 . 00 £0 . 00£0 . 00 0 . 00 £ 0. 00£0 . 00 0 . 00 £0. 00

£0 . 00 0 . 00 £0 . 00

£0 . 00 0 . 00 £0 . 00

£0 . 00 0 . 00 £0 . 00£0 . 00 0 . 00 £0 . 00£0 . 00 0 . 00 £0 . 00

£0.00 OA(£0.00 0.0(

£0.00 0.00

£0 . 00 0 .3(£220.00

AdministratorCost

85 . 95 £12 , 696 . 300 . 00 £0 . 000 . 00 £0 . 006 . 41 £760 . 469 . 00 £1 , 095 . 00

31 . 45 £3 , 920 . 500 . 00 £0 . 00

1 .0 0 £100 .002 . 41 £392 . 37

0 . 00 £0 . 000 00 £0 . 003 . 48 £579J0

0 . 00 £0 . 000 . 00 £0 .000 . 00 £0 . 00

0 . 00 £0 00

139 . 70 £19 , 544 . 33£139 . 90

Assistant TotalCost Time Cost

0 . 00 £0 . 00 94 . 25 £16 , 114 . 650 . 00 £0 . 00 0 . 00 £0 . 000 . 00 £0 . 00 0 . 00 £0 . 009 . 41 £1 , 047 . 26 23 . 77 £4 , 653 . 87

0 . 00 £0 . 00 10 . 10 £1 , 420 . 20

0 . 00 £0 . 00 31 . 65 £3 , 9 74 . 500 . 00 £0 . 00 0 . 00 £0 . 000 . 00 £0 . 00 1 . 00 £480 . 000 . 00 £0 . 00 2 . 20 £85520

000 £0 . 00 420 £1 , 378 . 80

0 . 00 £0 . 00 5 . 81 £1 , 443 . 37

0 . 00 £0 00 0 . 00 £0 . 00

OA(

0 . 0(

0 . 0(

0 . 00

9.4'

£11129

£0 . 00 0 . 00 £0 .£0 . 00 3 . 48 £579 .

£0 . 00 0 . 00 £0 .£0 . 0 0 0 . 00 £0 .£0 . 00 0 . 00 £0 .

£0 . 00 0 . 00 £0 .

Rule 8 . 1 Insolvency Act 1986 Form 8 .4

P l ease in sert name ofperso n (who m ust be 18 orover) or the Offici alReceiver if you wish toprovide for alternativep ro xy h olde rs in t h ecircum stan ces that yo u rfirst choice is unable toattend please state t hen ame(s) of the alte rn at ivesas well

Please delete words in I appoint the above person to be my/the creditor ' s/contributory ' s proxy holder at thebrackets if the proxy holder meeting of creditors/contributories to be held on 8 July 2014 , or at any adjournment ofis only to vote as directedi . e . he has no discretion that meeting . The proxy holder is to propose or vote as instructed below (and in

respect of any resolution for which no specific instruction is given , may vote or abstainat his/her discretion) .

Ple a se comp l e te p a ragraph1 if yo u wis h to nomin ate orv ote fo r a specifi c personas trus tee/li q uid ator

Please delete words in [In the event of a person named in paragraph 1 withdrawing or being eliminated frombrackets if the proxy holderis only to vote as directed any vote for the appointment of a liquidator/trustee the proxy-holder may vote or

i.e. he has no discretion abstain in any further ballot at his/her discretion]

Proxy (Administration of Insolvent Estate ofDeceased Person)

Lisa Kelly Dev i ne (Deceased)

Name ofCreditor/Contributory

Address

Name of Proxy Holder

1 . That the Trustee obtain his release from office .

2 . That the Trustees final receipts and payments account be approved .

ACCEPT/REJECT

ACCEPT/REJECT

Any othe r re s olut i ons whicht h e p roxy- h old er i s t opropose or vote in favour ofo r aga in st shou ld be setou t in n u mbe redpa rag ra phs in t h e spacep rovid ed be low pa rag rap h1. If m ore room is requ iredp l e ase use t h e ot h e r s ideof thi s form

This form must be signed Signature Date

Only to be com p l eted if t h ecredi tor/con t ributory h a snot s i g ned in pers o n

Name in CAPITAL LETTERS

Position with creditor/contributory or relationship to creditor/contributory orother authority for signature

Remember : there may be resolutions on the other side of this form

Softwa re Supp li ed by Turn key Compute r Technology L im ited, G l a s gow

Shipleys LLP10 Orange Street , Haymarket, London WC2H 7DQ

CREDITORS ' GUIDE TO FEESEFFECTIVE FROM 1 MAY 2014

CHARGE-OUT RATES

Staff Allocation and Support Staff

An objective and practical approach is taken to each case which includes act i ve Principal

involvement from the outset . Other members of staff will be assigned on the basis of

experience and specific skills to match the needs of the case . Set out below are the relevant

charge-out rates per hour worked for the grades of all staff . Time is charged by reference to

actual work carried out on each assignment . There has been no allocation of any general or

overhead costs .

GradeCharge-out rate (£ per hour)

plus VAT where applicable

Principal* 480 - 510

Manager 250 - 325

Assistant Manager 240 - 250

Senior Administrator 220 - 240

Administrator 140 - 190

Assistant & Cashier 110 - 265

* or equivalent

NB : Time costs are calculated at 6 minute units

The time of support staff is not charged to a case except when the initial set up is beingperformed and appointment documentation is prepared. Support staff will also occasionallycharge their time when performing a sizeable administrative task within the case. Supportstaff charge their time at the £110/hr Assistant rate shown on the preceding table.

Specialist departments with the firm such as Tax and VAT may sometimes charge their timeif and when the Office Holders may require their expert advice . The figures below providedetails of the charge-out rates per hour worked for typical staff involved in this way .

GradeCharge-out rate (£ per hour)

plus VAT where applicable

Tax Principal* 300-480

Tax Manager 250

Tax Practitioner 200

Tax Assistant 145

Details of historic charge out rates in respect of the London office are provided at the end ofthis guide . Should any creditor wish to receive details of the charge out rates for the Londonoffice in force prior to those shown , these can be provided upon request .

DISBURSEMENTS

Category 1 Disbursements

Category 2 Disbursements

These are costs that are directly referable to the appointment in question but not to an

independent third party . They may include shared or allocated costs that can be allocated to

the appointment on a proper and reasonable basis . In the event of charging for Category 2

disbursements the following items of expenditure are recharged on the basis specified :

Category Basis of Charge

Business Mileag e Motor vehicle at 40p per mile

Internal Room Hire Held at Shipleys LLP , 10 Orange Street , Haymarket , LondonWC2H 7DQ : £50

Photoco in S pecific calculation of 25 pence per sheet x number of creditors

Facsimiles £1 for 1 s a e and 10 pence for each additional page

Subcontractors

Details and the cost of any work which has been or is intended to be sub-contracted out thatcould otherwise by carried out by the office holder or his staff will be provided in any reportwhich incorporates a request for approval of the basis upon which remuneration may becharged .

Professional Advisors

Details of any professional advisor(s) used will be given in reports to creditors . Unlessotherwise indicated the fee arrangement for each is based on hourly charge out rates , whichare reviewed on a regular basis , together with the recovery or relevant disbursements . Thechoice of professional advisors is based around a number of factors including , but notrestricted to , their expertise in a particular field , the complexity or otherwise of theassignment and their geographic location .

These are costs where there is specific expenditure directly referable both to the

appointment in question and a payment to an independent third party . Examples of

equivalent costs that may be reimbursed to the office holders without uplift and do not requ i re

prior approval are given below :

01 /04/07 -31 /12/07 1 01 /01 /08 -31 /12/08 01 /01 /09 -31 /12/09 01 /01 /10 -31 /12/10 01 /01 /11 -31 /12/11 01 /01 /12 -31 /01 /12

Charge-out rate (£ per hour) plus VAT where applicable

Princ i pal* 360-370 375 395 395-445 410-460 460

D i rector n/a 340 355 375-400 n/a n/a

Manager 285-300 300 300 245-270 280 300-325

Assistant Manager 200-220 222 180-228 180-250 260 n/a

Sen ior Adm i n i strator 160-210 175-210 140-190 175-220 200-225 210-230

Admin istrator 110-155 127-165 100-165 75-155 85-160 125-170

Assistant & Cash ier 50-95 50-100 50-215 50-240 99-245 100-245

01 /02/12 -30/04/12 01 /05/12 -31 /07/12 01 /08/12 -31 /12/12 01 /01 /13 -30/04/13 01 /05/13 -31 /12/13 01 /01 /14-30/04/14

Charge-out rate (£ per hour) plus VAT where applicable

Principal * 460 400-480 400-480 450-480 465-495 465-495

Director n/a n/a n/a n/a n/a n/a

Manager 300-325 300-325 230-325 240-325 240-326 250-325

Assistant Manager n/a n/a n/a 230-240 230-240 240-250

Senior Administrator 210-230 210-230 210-230 220-235 220-235 220-240

Administrator 125-170 125-170 125-170 125-185 125-185 1 40-190

Assistant & Cashier 100-250 100-250 100-250 110-260 110-260 110-265

* or equivalent

SIP9 Guide to Trustees' Fees ( EM*

A CREDITORS ' GUIDE TO FEES CHARGED BY TRUSTEES I N BANKRUPTCY

ENGLAND AND WALES

1 Introduction

1.1 When an individual becomes bankrupt the costs of the bankruptcy proceedings are paid out of hisor her assets. The creditors, who hope to recover some of their debts out of the assets, thereforehave a direct interest in the level of costs, and in particular the remuneration of the insolvencypractitioner appointed to act as trustee. The insolvency legislation recognises this interest byproviding mechanisms for creditors to determine the basis of the trustee's fees. This guide isintended to help creditors be aware of their rights to approve and monitor fees and explains thebasis on which fees are fixed.

2 Ban k ruptcy procedure

2 . 1 Bankruptcy is the administration of the affairs of an insolvent individua l by a trustee in the interestsof his creditors generally . The trustee ' s function is to realise the assets and distribute them amongthe creditors i n a prescribed order of priority . Bankruptcy proceed i ngs commence with the makingof a bankruptcy order by the court . Immed iate ly on the making of the order an officia l ca ll ed the

official receiver becomes receiver and manager of the bankrupYs estate pending the appointmentof a trustee . The official receiver is an officer of the court and a member of The Insolvency Service ,an executive agency within the Department of Trade and Industry . Where there are significantassets an inso lvency pract i t ioner wi ll usual ly be appointed to act as trustee , e i th er by a meeting ofcreditors or by the Secretary of State for Trade and Industry . Where no inso lvency practit ioner i sappointed , or where there is a vacancy in the office of trustee , the official receiver acts as trustee .

The creditors ' committee

3 . 1 The creditors have the right to appoint a committee , with a minimum of 3 and a maximum of 5members, to monitor the conduct of the bankruptcy and approve the trustee ' s fees . The committeemay be establ ished at the creditors ' meeting whi ch appoints the trustee or at a meeting convenedfor the purpose by the trustee after his appointment .

3 . 2 The trustee must call the first meeting of the committee within 3 months of its establ ishment ( or hisappointment if that is later) , and subsequent meetings must be held either at dates agreed by thecommittee , or when a member of the committee asks for one , or when the trustee decides heneeds to hold one . The trustee is required to report to the committee at least every 6 months onthe progress of the bankruptcy , unless the committee directs otherwise . This provides anopportunity for the committee to monitor and discuss the progress of the insolvency and the level ofthe trustee ' s fees .

F ixing the trustee 's fees

4 . 1 The basis for fixing the trustee ' s remuneration is set out in Ru les 6 . 138 - 6 . 139 of the InsolvencyRules 1986 . The Rule states that the remuneration shall be fixed e ither:

• as a percentage of the value of the assets which are realised or distributed or both , or• by reference to the time properly given by the trustee and his staff i n attending to matters

arising in the bankruptcy .

I t i s for the committee (if there is one ) to determine on which of these bases the remune ration i s tobe fixed, and if it is to be fixed as a percentage, to fix the percentage to be applied. Rule 6.138says that in arriving at its decision the committee shall have regard to:

• the comp lexity (or otherwise ) of the case ;• any re sponsibility of an exceptional kind or degree which falls on the trustee in connection

with the bankruptcy;• the effectiveness with which the trustee appears to be carrying out, or to have ca rri ed out ,

h i s dut i es ;

1111111 SIP9 Guide to Trustees' Fees (E8W)

• the value and nature of the assets wh ich the trustee has to deal with .

4 .2 I f there i s no committee , or the committee does not make the requi site determination, the trustee 'sremuneration may be fi xed by a resol ution of a meeting of cred itors . The creditors must takeaccount of the same matters as the committee would. A resoluti on specifying the basis on whichthe trustee is to be remunerated may be taken at the meeting which appoints the trustee. If theremuneration i s not fixed in any of these ways , it will be i n accordance with a sca le set out in the

Rules.

What information should be provided by the trustee?

5.1 When seeking fee approval

5 . 1 . 1 When seeking agreement to his fees the trustee should provide sufficient supporting information toenable the committee or the creditors to form a judgement as to whether the proposed fee is

reasonable having regard to all the circumstances of the case . The nature and extent of the

supporting information which should be provided will depend on :

• the nature of the approval being sought;• the stage during the administration of the case at which it i s be i ng sought; and

• the size and complexity of the case.

5.1.2 Where , at any cred i tors ' or committee meeting , the trustee seeks agreement to the te rms on which

he is to be remunerated , he should provide the meet ing with deta ils of the cha rge-out ra tes of a ll

grades of staff, i nclud i ng principa l s , which a re like ly to be involved on the case .

5 . 1 . 3 Where the trustee seeks agreement to his fees during the course of the bankruptcy , he should

always provide an up to date receipts and payments account . Where the proposed fee is based on

time costs the trustee should disclose to the committee or the creditors the time spent and the

charge-out va l ue in the particular case , together with , whe re appropriate , such addit iona l

irtformation as may reasonably be required having regard to the size and complex ity of the case .

The additional information should comprise a sufficient explanation of what the trustee has

achieved and how it was achieved to enable the value of the exercise to be assessed (whilst

recognis i ng that the trustee must fu l fi l certa i n statutory ob l igations that might be seen to br i ng noadded value for creditors) and to establish that the time has been properly spent on the case . Thatassessment will need to be made having regard to the time spent and the rates at which that timewas charged , bearing in mind the factors set out in paragraph 4 . 1 above . To enable thisassessment to be carried out it may be necessary for the trustee to prov ide an analysis of the ti mespent on the case by type of activity and grade of staff. The degree of detail will depend on the

circumstances of the case , but it will be helpful to be aware of the professional guidance which hasbeen given to inso lvency practitioners on this subject . The gu idance suggests the fo l lowing areas ofactivity as a basis for the analysis of time spent :

• Administration and planning

• Investigations• Realisation of assets• Trad ing• Cred itors• Any other case-specific matters

The following categories are suggested as a basis for analysis by grade of staff:

• Partner• Manager• Othe r senior professiona ls• Ass istants and support staff

The explanation of what has been done can be expected to i nclude an outline of the natu re of theassignment and the trustee ' s own initi a l assessment , inc ludi ng the anticipated return to cred i tors.To the extent applicable it should a l so exp l ain:

2

SIP9 Guide to Trustees ' Fees (EBWI

• Any sign ificant aspects of the case , particu larly those tha t affect the amount of time spent.

• The reasons for subsequent changes in strategy.• Any comments on any figures in the summary of time spent accompanying the request the

trustee wishes to make.• The steps taken to establi sh the vi ews of cred itors , pa rticul arly in re l ation to ag reeing the

strategy for the assignment, budgeting, time recording, fee drawing or fee agreement.

• Any existing agreement about fees.• Details of how other professionals, includin g subcontractors, were chosen, how they were

contracted to be pa id, and what steps have been taken to revi ew their fees.

It should be bome in mi nd that the deg ree of ana lysis and form of presentation shou l d be

proportionate to the s ize and complexity of the case . In sma ller cases not a ll categories of activity

will always be relevant, whilst further analysis may be necessary in larger cases .

5.1.4 Where the fee is charged on a percentage basis the trustee should provide details of any workwhich has been or is intended to be sub-contracted out which would normally be undertakendirectly by a trustee or his staff.

5 . 2 After fee approva l

Where a resolution fixing the bas i s of fees is passed at any creditors' meeting he ld before he has

substanti ally completed his functions, the trustee should notify the creditors of the details of the

resolution. When subsequently reporting to creditors on the progress of the bankruptcy, or

submi tting h i s fi na l report , he should specify the amoun t of remuneration he has d rawn in

accordance with the reso l ution . Whe re the fee i s based on time costs he also shou l d provide

deta ils of the time spent and charg e-out value to date and any material changes in the rates

cha rged for the various g rades since the resoluti on was fi rst passed . He shoul d a lso provide such

additional information as may be required in accordance with the principles set out in paragraph

5.1.3. Where the fee is charged on a percentage basis the trustee should provide the details set

out in pa rag raph 5.1.4 above regarding work which has been sub-contra cted out .

5.3 Expenses and disbursements

There is no statutory requirement for the committee or the cred itors to approve the drawing of

expenses or disbursements . However , professional guidance issued to insolvency practitioners

requires that , where the trustee proposes to recover costs which , whilst being in the nature of

expenses or disbursements , may include an element of shared or allocated costs (such as room

hire , document storage or commun i cation faci l ities provided by the trustee 's own firm) , they must

be disclosed and be authorised by those responsible for approving his remuneration . Suchexpenses must be directly incurred on the case and subject to a reasonable method of calculationand allocation .

5.4 Realisations for secured creditors

Where the trustee realises an asset on behalf of a secured creditor and receives remuneration outof the proceeds (see paragraph 8 . 1 below) , he should disclose the amount of that remuneration tothe committee (if there is one) , to any meeting of creditors convened for the purpose of determininghis fees , and in any reports he sends to creditors .

5 . 5 Reporting - gene ral

It should be bome in mind that there is no statutory requirement for the trustee to report to creditorsuntil the concl usion of the assignment. In most such cases , therefore , credi tors will receive noi nformation d uring the course of the bankruptcy un l ess they specifica lly request i t .

What if a creditor i s dissatisfied?

6.1 Except in cases where there i s a committee it i s the cred itors as a body who have authority toapprove the trustee 's fees . To enable them to carry out thi s function they may req u ire the trustee toca ll a creditors ' meeting . I n order to do th is at l east ten pe r cent in va lue of the creditors mustconcur with the req uest, which must be made to the trustee in wri ting .

S IP9 Guide to Trustees' Fees (E&Wl

6.2 If a creditor believes that the trustee's remuneration is too high he may, if at least 25 per cent in

value of the creditors (including himself) agree, apply to the court for an order that it be reduced. If

the court does not dismiss the application (which it may if it considers that insufficient cause is

shown) the applicant must give the trustee a copy of the application and supporting evidence at

least 14 days before the hearing. Unless the court orders otherwise, the costs must be paid by the

applicant and not out of the bankrupt's assets.

What if the trustee is dissatisfied?

7. 1 I f the trustee considers that the remuneration fixed by the committee i s i nsuffi cient he may request

that it be i ncreased by resolution of the cred itors . I f he considers that the remuneratio n fixed by the

committee or the creditors or in accordance with the statutory scale is insufficient, he may apply to

the court for it to be i ncreased . If he decides to apply to the court he must give at least 1 4 days '

notice to the members of the committee and the committee may nominate one or more of its

members to appear or be represented at the cou rt hea ri ng . I f there i s no committee , th e trustee 's

notice of his app lication must be sent to such of the cred i tors as the court may d irect, a nd they may

nominate one or more of the i r number to appea r or be represented. The cou rt may order the costs

to be paid out of the assets.

Other matters relating to fees

8.1 Where the trustee realises assets on behalf of a secured creditor he is entitled to be remunerated

out of the proceeds of sale in accordance with a scale set out in the Rules. Usually, however, the

trustee will agree the basis of his fee for dealing with charged assets with the secured creditor

concemed.

8 . 2 Where joint trustees are appointed it is for them to agree between themselves how theremuneration payable should be apportioned . Any dispute between them may be referred to thecourt, the committee or a meeting of creditors .

8.3 If the trustee is a solicitor and employs his own firm to act in the insolvency, profit costs may not bepaid unless authorised by the committee, the creditors or the court.

8 .4 There may also be occasions when creditors will agree to make funds available themselves to payfor the trustee to carry out tasks which cannot be paid for out of the assets , either because they aredeficient or because it is uncertain whether the work undertaken will result in any benefit tocreditors . Arrangements of this kind are sometimes made to fund litigation or investigations intothe bankrupt's affairs . Any arrangements of this nature will be a matter for agreement between thetrustee and the creditors concemed and will not be subject to the statutory rules relating toremuneration .

9. Provision of information - additional requirements

In any case where the trustee is appointed on or after 1 April 2005 he must provide certaininformation about time spent on the case, free of charge, upon request by the bankrupt or anycreditor. The information which must be provided is -

• the tota l number of hours spent on the case by the trustee or staff ass ig ned to the case ;• for each grade of staff , the average hourly rate at which they a re charged out ;• the number of hou rs spent by each g rade of staff in th e re l evant pe riod .

The period for which the information must be provided is the period from appointment to the end ofthe most recent period of six months reckoned from the date of the trustee's appointment, or wherehe has vacated office, the date that he vacated office.

The i nformation must be provided withi n 28 days of rece ipt of the req uest by the tru stee , andrequests must be made within two years from vacation of offi ce.