Re Segoes Servs Ltd

• Jurisdiction: Cayman Islands
• Judge: (Henderson, J.)
• Judgment Date: 27 March 2007
• Court: Grand Court (Cayman Islands)
• Date: 27 March 2007

Grand Court

(Henderson, J.)

IN THE MATTER OF SEGOES SERVICES LIMITED (in liquidation)

A. Walters for the applicants;

S. Dickson for the respondents.

Case cited:

(1) Att. Gen. v. Cleaver & Co., 2006 CILR 222, followed.

Legislation construed:

Companies Law (2004 Revision), s.107(2): The relevant terms of this sub-section are set out at para. 2.

Practice Directions cited:

Practice Direction No. 2/2003, Remuneration of Official Liquidators.

Practice Direction No. 1/2006, Liquidators” Remuneration.

Companies-liquidators-remuneration-under Practice Direction No. 1/2006, creditors” committee to be provided with ‘all relevant information’ needed to determine reasonableness of liquidators” fees-includes, e.g., detailed invoices showing dates, times and descriptions of work done and identity of person doing it, engagement letters and account statements for law firms working on liquidation

The joint official liquidators of a company applied for the approval of their fees in connection with the liquidation of the company.

Following the collapse of the company, joint official liquidators (‘JOLs’) were appointed and a creditors” committee formed to oversee the liquidation. The JOLs submitted details of their fees to the creditors” committee, which alleged that it had not been given sufficient information to decide whether to approve them and also requested details of substantial payments made to the JOLs” US and Cayman attorneys. The JOLs refused to supply further information and applied to the court for the approval of their fees under the Companies Law (2004 Revision), s.107(2).

The JOLs submitted that (a) the information already provided, showing the total time spent on certain categories of task, was sufficient to enable the committee to reach a considered decision; (b) further disclosure by them would lead to unproductive debate and consequent delay; and (c) according to the guidance given by the Rules Committee”s Creditors” Guide to Liquidators” Fees, it was not normal practice to provide information in the format requested.

The creditors” committee submitted in reply that (a) it merely required invoices of the type commonly used by law and accounting firms, giving the dates, times and a brief description of the work done by each professional; (b) the JOLs had ready access to this data, since it had been collected and stored on their computer system; and (c) the Creditors” Guide to Liquidators” Fees had now to be read in the light...