Glatt & Ors v Sinclair

A court-appointed receiver may recover remuneration, expenses and disbursements for necessary work performed after the receivership order has been discharged. The receiver remains an officer of the court, subject to its supervision, while performing functions required to conclude the receivership, transfer assets or enforce a lien.

The court retains jurisdiction to approve payment from receivership assets. It may disallow work which was unnecessary, unreasonable, disproportionate or unrelated to concluding the receivership. An appellate court may also refuse a pure point of law raised for the first time on appeal where the opposing party relied to its detriment on the point not having been taken below.

A receiver appointed over assets under section 77(8) of the Criminal Justice Act 1988 continued to perform work after the receivership order was discharged. Mitting J subsequently determined that his orders authorised payment from the receivership assets for remuneration, expenses and disbursements incurred both before and after discharge: [2012] EWHC 2015 (Admin).

The interveners appealed. They contended that the order did not cover post-discharge work and that the court lacked jurisdiction to approve payment for such work. A further issue was whether they should be permitted to advance that jurisdictional argument after the earlier hearing had proceeded on the accepted basis that post-discharge remuneration and expenses were recoverable in principle.

1. Appeal dismissed. Mitting J's order of 14 December 2010 authorised recovery of post-discharge remuneration, expenses and disbursements. Its references to costs incurred up to 19 November 2010, together with its provisions concerning interest and the interim payment, necessarily covered work performed after discharge.
2. The interveners could not justly raise the jurisdictional argument for the first time on appeal. The earlier hearing had proceeded on the accepted basis that the receiver could recover for post-discharge work, with only quantum disputed. The receiver subsequently undertook substantial work in reliance on the order and the common understanding of the parties. He would suffer significant detriment if the new point were allowed and succeeded.
3. As an alternative ground forming part of the decision, the court held that jurisdiction existed. A receiver appointed under section 77(8) of the Criminal Justice Act 1988 acts according to the common law except where the Act provides otherwise. The receiver ordinarily looks to the receivership assets for indemnification and may retain a lien over them. Neither the right to indemnity nor the lien is necessarily extinguished by discharge.
4. A discharged receiver remains an officer of the court, subject to its supervision, so far as functions remain necessary to conclude the receivership. Rule 69.11 of the Civil Procedure Rules 1998 confirms that functions such as transferring assets may remain after discharge. Its list is not exhaustive. Closing accounts, concluding administration and enforcing a lien may likewise require time and expenditure.
5. There was no principled common law or procedural basis for preventing a claim for remuneration and expenses necessarily incurred in winding up the receivership. Rule 69.7 uses broad language and subjects remuneration to court approval. The court may disallow work which was unnecessary, unreasonable, disproportionate or unrelated to the receivership or the conclusion of its affairs.
6. Litigation costs incurred in connection with a receivership remain governed by the orders made in the relevant proceedings and by the court's discretion. Their amount remains subject to assessment where it is not agreed.

1. Court of Appeal (Civil Division): The appeals were dismissed on every ground: [2013] EWCA Civ 241.
2. High Court, Administrative Court: Mitting J held that the order of 14 December 2010 extended to post-discharge remuneration, expenses and disbursements, and directed that those amounts were payable from the receivership assets: [2012] EWHC 2015 (Admin).