Pre-pack administration costs recoverable

Recent changes to the Insolvency Rules 1986 have altered the incidence of an administrator's remuneration and expenses

Recent changes to the Insolvency Rules 1986 have altered the way in which an administrator's remuneration and expenses are dealt with. Costs and expenses incurred by insolvency practitioners in the run up to the administration of a company will now become recoverable from the assets realised in the administration. It seems likely that the changes will enable administrators to recover the costs incurred in negotiating a pre-pack sale of the company's business and assets from the sales proceeds before distributing the proceeds.