In the matter of Fearndale Holdings Pty Ltd (in liq) (recs & mgrs apptd)

This is an application by Mr Cook as voluntary administrator, Court-appointed receiver and liquidator of Fearndale Holdings Pty Ltd (in liq) (“Fearndale”) to establish his entitlement to be paid costs and remuneration from trust assets and for approval of the quantum of that remuneration for the period to 22 May 2020. Although this application is brought in proceedings which have been heavily contested, as will emerge below, none of the parties to the proceedings or the creditors of Fearndale have opposed the application.

I should first set out the background to the application, which I have largely drawn from my earlier judgment in Re Fearndale Holdings Pty Ltd (admin apptd) (recs & mgrs apptd) [2019] NSWSC 1810. By way of background, Fearndale has been, since 10 January 12007, the trustee of the Fearndale Trust (“Trust”). It was placed in administration on 12 March 2018 by a secured creditor, Consolidated Capital and Funding Pty Ltd (“CCF”). Mr Cook was initially appointed as voluntary administrator to Fearndale on 2 May 2018, in replacement of the then voluntary administrators who had been appointed by CCF and was appointed receiver and manager of the property of the Trust on 4 December 2018.

Fearndale owned certain land (“Land”) at Luddenham in New South Wales, which was sold by Mr Cook on 19 November 2019 in his capacity as voluntary administrator appointed to Fearndale. The Plaintiffs in the proceedings, the Messrs Harpley, are directors of Fearndale and own a substantial percentage of its shares. Fearndale guaranteed certain obligations of another entity, Equivest Holdings Pty Limited (“Equivest”) under two loans made by Australia and New Zealand Banking Group Limited (“ANZ”) to Equivest. On or about 10 December 2014, ANZ assigned the Term Loan, the Overdraft Facility, Fearndale’s guarantee and the mortgage and its rights thereunder to a Defendant in the proceedings, CCF. Equivest and Fearndale did not make payments to ANZ or CCF in respect of the relevant loans from at least 19 December 2014.

Disputes arose between, inter alia, Fearndale and CCF and, by orders made by consent on 2 May 2018, Leeming JA (sitting at first instance in the Corporations List) ordered, inter alia, that there be a referral under rr 20.14, 20.15 and 20.17 of the Uniform Civil Procedure Rules 2005 (NSW) to a referee for hearing and determination of the reasonable and proper amounts to which CCF was entitled to receive out of the proceeds of the sale of the land owned by Fearndale in satisfaction of its entitlements under the guarantee and mortgage, including receivers’ fees and expenses. CCF subsequently assigned its interest in the relevant loan and securities to Australian Lending Investments Pty Ltd (“ALI”). By my judgment in Re Fearndale Holdings Pty Ltd (admin apptd) (recs & mgrs apptd) above, I adopted the referee’s report and made certain orders.

On 19 November 2019, a sale contract for the Land completed at a purchase price of $14 million plus GST. By orders made by consent, an amount of just under $3.4 million was then paid to the registered first mortgagee of the Land, ALI as assignee of a debt and securities, including real property mortgage, from CCF and the amount of $10,329,771.72 was paid into Court on or about 19 November 2019.

On or about 6 March 2020, an amount of $2,507,162.37 was paid from the funds in Court to Fearndale, and a balance of $7,822,609.35 remains as funds in Court. In his ex tempore judgment ordering that payment, Gleeson JA (then sitting at first instance in the Corporations List) observed that:

Mr Cook previously sought approval for his remuneration at meetings of creditors held on 6 March and 12 May 2020 and that approval was not obtained. Creditors have been given notice of this application and no creditor has sought to be heard in opposition to it, notwithstanding that several of Fearndale’s creditors and contributories, including ALI, Equivest and the Messrs Harpley have been involved in ongoing and wider proceedings in respect of the liquidation.

In a further hearing that commenced on 7 July 2020, the parties have advanced competing claims to funds paid into Court by Fearndale. The parties have now proposed consent orders to be made by the Court, and judgment will be delivered today in that regard.

In this application, made by Amended Interlocutory Process filed, by leave, on 13 July 2020, Mr Cook seeks a determination under s 60-10 of the Insolvency Practice Schedule (Corporations) that he is entitled to receive remuneration for work performed in relation to the external administration of Fearndale for the period commencing 5 May 2018 and ending 22 May 2020 in the substantial amount of $1,213,420, exclusive of GST, and an order that the costs of the application be costs in the external administration. By his Points of Claim filed on 16 March 2020, Mr Cook pleads a “salvage” claim, in respect of work done to secure possession of the Land; undertake a sale campaign in respect of the Land; participate in several proceedings concerning claims made by third parties in respect of the Land; and conclude a sale of the Land. Mr Cook refers to several affidavits filed in the proceedings which set out the work done in that respect.

By his Points of Claim, Mr Cook pleads that the sale of the Land was achieved by reason of the Salvage Efforts (as defined) and the funds in Court were created by reason of those efforts. Mr Cook also contends that, by reason of ss 443D-443F of the Corporations Act 2001 (Cth), or a right of indemnity or exoneration from the property of the Fearndale Trust for remuneration and expenses, or by reason of the equitable principle of salvage, he is entitled to sufficient part of the Balance (as defined) to enable the discharge of his Salvage Claim (as defined). Mr Cook also pleads the fact of proceedings brought by a third party, Drama Unit Pty Ltd (“Drama Unit”) against Fearndale, and against Mr Cook in his capacity as administrator of Fearndale, advancing several allegations in respect of the status of a mining licence in relation to the Land. Mr Cook notes that he is defending those proceedings and will incur costs and expenses in doing so, and claims a right of indemnity from Fearndale’s property in respect of the defence of those proceedings.

By paragraph 21 of the Points of Claim, Mr Cook pleads that the Salvage Claim has priority over all other claims to the Balance, including any of ALI, Equivest, the former administrators or the Messrs Harpley, under the principles of salvage described in Re Universal Distributing Company Ltd (in liq) [1933] HCA 2; (1993) 48 CLR 171 and Stewart v Atco Controls Pty Ltd (in liq) [2014] HCA 15; (2014) 252 CLR 307. Alternatively, Mr Cook pleads that that claim takes priority after the payment of any priority claims, as defined. The question of priority between those claimants does not need to be determined since it is not apparent that the proceeds of sale of the Land are likely to be insufficient to meet each of their proper claims.

Mr Cook relies on his affidavits dated 1 May 2020 and 22 May 2020 in respect of the application, and on exhibits TJC-9, TJC-10 and TJC-11 to those affidavits (now Exhibits F2, F3 and F4 in the wider application before the Court as well as this application) and on a further affidavit of Mr Laba, one of his employees. By his affidavit dated 1 May 2020, Mr Cook referred to the circumstances of his appointment as administrator of Fearndale and to the investigations that led him to identify the Land as held by Fearndale as trustee for the Fearndale Trust and to his subsequent appointment by the Court as receiver and manager of all property held by Fearndale as trustee for the Fearndale Trust. His evidence was that most, if not all, of the tasks undertaken by him or at his direction were undertaken in his capacity as administrator of Fearndale and as receiver and manager of the property held by Fearndale on trust for the Fearndale Trust (Cook 1.5.20 [13]).

Mr Cook set out an extensive chronology of the administration, over some 10 pages and 66 paragraphs of his affidavit, which amply identified the complexity of the administration. He referred to claims by third parties asserting an interest in the Land, including an unregistered leasehold interest claimed by Drama Unit; a claim by CCF that it was a secured creditor of Fearndale owed a debt of, at the time of his appointment, at least $1.618 million; a claim by Epic Mining Pty Ltd (“Epic Mining”) pursuant to a lease dated August 2010; a claim by Equivest that it was also a secured creditor of Fearndale and held security over the Land; claims by the Messrs Harpley, who were directors of the Company, to a vendors’ lien over the Land and a life estate in part of the Land; and a claim by the former receivers and managers of the Land, appointed by CCF, to a lien for their fees. He also refers to valuation advice he obtained in respect of the Land as encumbered by Drama Unit’s interest, which indicated a value significantly less than he ultimately achieved in the sale process.

Mr Cook also referred to steps taken in the conduct of the administration, including the issue of examination summonses and orders for production directed to investigating, inter alia, whether the Land was held by Fearndale as trustee of the Fearndale Trust and issues relating to the use of the Land and dealings between Fearndale and Epic Mining and Drama Unit. There is evidence of the substantial analysis which was undertaken by Mr Cook and members of his staff following the public examinations to identify the conclusions that could be drawn from them (Ex F2, 32ff).

Mr Cook also refers to proceedings brought by Drama Unit in this Court, the history of which is evident from the Court file and from judgments at first instance and in the Court of Appeal, including Re Fearndale Holdings Pty Ltd (admin apptd) [2019] NSWSC 478; Re Fearndale Holdings Pty Ltd [2019] NSWSC 645 and Re Drama Unit Pty Ltd [2019] NSWSC 1169. Mr Cook also refers to steps which he took to restrain ALI from taking enforcement action in respect of the Land and to the steps taken to obtain further orders from the Court to facilitate a sale of the Land. Mr Cook also tendered a printout of Court attendances in the matter, which runs for some 50 pages in relatively small print between 27 March 2018 and 24 February 2020 and does not include more recent attendances in the matter (Ex A3).

Mr Cook in turn set out the basis of the calculation of his remuneration and time recording, in categories including attendances at Court; involvement in the proceedings brought by Drama Unit against Fearndale and Mr Cook; the examination process; investigations of property; dealing with creditors; and conducting the sale process. Some of these categories reflect the particularly litigious character of this voluntary administration. Mr Golledge also drew attention to work-in-progress (“WIP”) schedules maintained by Mr Cook’s firm which allocated the work done by person and by category across the several categories addressed in Mr Cook’s evidence (Ex F2, 31). Mr Cook also tendered WIP records, comprising nearly 180 pages, arranged by category, identifying the person who did the relevant work and the nature of the work done (Ex F2, 389ff). I have, consistent with the authorities, undertaken a broad review of those narratives, without seeking to review each attendance or the time spent on it. The schedule of work done by category and by person was updated by a further schedule for the period from 1 May to 20 May 2020 (Ex F4, 392-393).

Mr Cook also addressed the hourly rates that he charged and his experience as to rates charged by other practitioners in the Sydney market, and indicated the basis on which he considered it appropriate to calculate his remuneration on a time charged basis. Mr Cook’s hourly rates as at 1 July 2017, and as increased at 1 July 2018 were in evidence (Ex F2, 26-27). Mr Cook’s evidence that his and his firm’s hourly rates were not above market was supported by evidence that the rates of Fearndale’s former voluntary administrator, Mr Calabretta, were generally higher than Mr Cook’s rates (Ex A2) and the hourly rates of Mr Albarran, who was appointed as receivers and managers to Epic Mining, also generally exceeded Mr Cook’s hourly rates (Ex A4). Mr Cook also referred to the distribution of work between members of his staff, and the basis on which work was allocated between staff having regard to their experience and the complexity of the particular work. I recognise that in this case, the extent of litigation and the attitude of claimants to the Land were such that the work had a higher degree of complexity than would ordinarily be the case.

Mr Cook then addressed, in detail, each of the categories of costs claimed, including in respect of the particular proceedings brought by and against the parties to whom I have referred above, and to the work undertaken in respect of the sale process and public examinations and orders for production. Mr Cook also addressed work done to secure and maintain the Company’s property including the Land, including steps taken to restrict unauthorised access to the Land and dealings with the New South Wales Environmental Protection Authority. Mr Cook also referred to steps undertaken, by way of investigation, to address uncertainties as to the Fearndale Trust and confirm the position in respect of the ownership of the Land and steps taken to value the Land and the subsequent marketing and sale process for the Land.

By his further affidavit dated 22 May 2020, Mr Cook addressed the payment of disbursements and costs included in his claim in respect of the Land, which include marketing fees in respect of the Land, legal expenses, accounting and tax expenses and disbursements such as valuation expenses that Mr Cook had paid during the administration. Mr Cook also tendered schedules of disbursements paid by his solicitors and by his firm, including substantial disbursements incurred prior to the availability of any access to funds generated by the sale of the Land (Ex A6). Mr Cook also tendered evidence as to the invoices paid by his firm in the course of the matter (Ex F4, 1ff) and the narrative of work done by his solicitors in the conduct of the matter including in the multiple proceedings (Ex F4, 6ff). Some of those disbursements and costs have now been paid by the amount released to Fearndale from funds paid into Court by the orders made on 3 March 2020 to which I have referred above. Mr Cook identifies the remaining unpaid disbursements and costs, including legal fees, accountancy fees and Counsel’s fees for ongoing work in the proceedings. Mr Cook also responded to other evidence led in the wider proceedings, which it is not necessary to address for the purposes of this application.

By a further affidavit dated 6 July 2020, Mr Laba, who is an accountant employed by Mr Cook, refers to the creditors’ meetings on 6 March 2020 and 12 May 2020 which rejected resolutions for the approval of Mr Cook’s remuneration. That affidavit annexes the remuneration report issued to creditors on 27 February 2020 and a further remuneration report issued to creditors on 5 May 2020. The remuneration reports in turn provided a detailed account of the work done by, and costs incurred, by Mr Cook, which are also addressed in the affidavit evidence to which I have referred above. I have not neglected the fact that creditors did not approve the remuneration claimed at the relevant meetings, but the Court has jurisdiction to deal with the claim for remuneration in those circumstances, and it is plainly not tenable that extensive work should be undertaken by insolvency practitioners who are not remunerated for that work.

Mr Laba also refers to notice given to creditors on 12 June 2020 of Mr Cook’s intention to apply for orders approving his remuneration from the Court, which included providing copies of his affidavits dated 1 May 2020 and 22 May 2020, without exhibits, to creditors. Many of the major creditors of Fearndale are aware of the application, in any event, by reason of their involvement in the wider proceedings. Mr Cook also notified the Australian Taxation Office of the application, although it has not sought to be heard in this application.

In submissions, Mr Golledge, who appears with Mr Somerville for Mr Cook, summarises the affidavit evidence. He points to the fact that Mr Cook was appointed as voluntary administrator by a Court order made by Leeming JA (then sitting in first instance in the Corporations List) with the consent of the Messrs Harpley, CCF (which was at the time the first mortgagee of the Land), the then voluntary administrators of Fearndale and the receivers of Epic Mining in resolution of then ongoing litigation. At the time of Mr Cook’s appointment, the Land had been valued at a substantially lower amount than was ultimately realised by Mr Cook on its sale, and was subject to an existing lease to a third party, Drama Unit, which Mr Cook considered rendered it less attractive to a purchaser. It was also proximate to the site of the proposed second Sydney airport, which would potentially make it more attractive to a purchaser.

Mr Golledge also refers to the range of claims made by third parties, including some of the entities to which I have referred above, seeking to establish rights to the Land and to the various attempts made by those third parties, at various times, to challenge the control of the Land which had been conferred on Mr Cook by the Court orders. Mr Golledge points to the fact that Mr Cook met, from his own resources, the significant costs of a valuer in respect of the Land and also secured the consent of his solicitors to defer claims for legal fees and recoupment of disbursements in respect of the sale process for the Land. Mr Golledge points out that Mr Cook ultimately achieved a sale of the land at more than three times the value that would have been expected had the lease claimed by Drama Unit remained in place, and that the remuneration he now claims represents about 8.6% of the sale proceeds of the Land, in circumstances where the realisation process has been contested at every step.

As I noted above, Mr Cook seeks an order to establish his right to remuneration, costs and expenses from the proceeds of sale of the land and relies on Fearndale’s right of exoneration or indemnity from the Fearndale Trust and on “salvage” principles to support that order. By clause 10.6 of the Trust Deed for the Fearndale Trust (Ex A1), Fearndale was entitled to be indemnified out of the assets comprising the Trust Fund (as defined) against liabilities incurred by it in the execution or attempted execution or as a consequence of a failure to exercise any of the trust authorities, powers and discretions under the Trust Deed or by virtue of being the Trustee. The case law, which I address below, recognises that the liquidator of a trustee company may, in a proper case, be allowed payment of his or her remuneration, costs and expenses from trust assets.

Broadly, Fearndale as trustee of the Trust has a right to be indemnified out of and exonerated from the assets of the Trust in respect of all liabilities that it has properly incurred as trustee of that trust, arising under the trust deed, under s 59(4) of the Trustee Act 1925 (NSW) and at general law: Octavo Investments v Knight (1979) 144 CLR 360 at 367; Commissioner of Stamp Duties v Buckle [1998] HCA 4; (1998) 192 CLR 226 at [49]); Re Glenvine Pty Limited (in liq) [2020] NSWSC 866. A right to indemnity and exoneration constitutes a “proprietary interest” in the assets of the Trust and that interest gives Fearndale a charge or right of lien over those assets: Octavo Investments v Knight above at 367 and 370; Commissioner of Stamp Duties v Buckle above at [49]-[50]; Bruton Holdings Pty Ltd v Commissioner of Taxation [2009] HCA 32; 239 CLR 346 at [43]; Carter Holt Harvey Woodproducts Australia Pty Ltd v Commonwealth [2019] HCA 20; (2019) 368 ALR 390 at [32], [80] and [84]. In Carter Holt Harvey Woodproducts Australia Pty Ltd v Commonwealth above, the plurality observed (at [32]-[33]) that:

Mr Golledge also refers to Re Universal Distributing Co Ltd above as authority that the remuneration, costs and expenses incurred by a liquidator in preserving, recovering and realising a fund on behalf of others would generally be paid out of, and are secured by an equitable lien over, the relevant fund is well-recognised in the case law: Coad v Wellness Pursuit Pty Ltd (in liq) [2009] WASCA 68; (2009) 40 WAR 53; Re Parbery & Ors as liquidators of Trio Capital Ltd (in liq) [2012] NSWSC 597 at [18]; (2012) 88 ACSR 700. In 13 Coromandel Place Pty Ltd v CL Custodians Pty Ltd (in liq) [1999] FCA 144; (1999) 30 ACSR 377 at [34], Finkelstein J observed that:

In Bastion v Gideon Investments Pty Ltd (in liq) [2000] NSWSC 939; (2000) 35 ACSR 466, where all of a company’s assets were trust assets and the liquidator had incurred costs and expenses in investigating the affairs of the company, Austin J similarly held (at [71]) that:

In Westpac Banking Corporation v ITS Taxation Services Pty Ltd [2004] NSWSC 50; (2004) 183 FLR 273; (2004) 22 ACLC 229 at [26]-[27], Austin J in turn observed that:

In Stewart (in his capacity as liquidator of Newtronics Pty Ltd (in liq)) v Atco Controls Pty Ltd (in liq) above, the High Court also considered the circumstances in which a liquidator’s equitable lien would be available over a settlement amount in liquidation, and observed that that principle in Re Universal Distributing above applies where an insolvent company is in liquidation; the liquidator has incurred expenses and rendered services in the realisation of an asset; the resulting fund is insufficient to meet both the liquidator’s costs and expenses of realisation and the debt due to a secured creditor; and the secured creditor claims the fund. Their Honours noted that the application of the principle avoids the result that a secured creditor would unconscientiously take the benefit of the liquidator’s work without the liquidator’s expenses being met and observed (at [41]) that such a lien arose simply from the fact that the liquidator’s costs and remuneration were incurred in realising the assets that created the relevant fund. Mr Golledge also refers to Re Aberdeen All Farm Pty Ltd (in liq) [2020] NSWSC 770 where I summarised aspects of these principles.

There is not a complete identity between the amount of remuneration claimed by Mr Cook in the liquidation and the amount claimed from the trust property by way of the “salvage” claim and that “salvage” claim also extends to costs and disbursements which do not require the Court’s approval under s 60-10 of the Insolvency Practice Schedule (Corporations) (“IPSC”), which I address below. In particular, the amount of remuneration claimed by Mr Cook as incurred to 22 May 2020 in respect of the “salvage” claim is $990,220 (exclusive of GST), which is less than the amount of remuneration for which Mr Cook claims approval under s 60-10 of the IPSC; Mr Cook also identifies costs and expenses within the salvage claim of $1,980,951.61, inclusive of GST, which include substantial legal expenses relating to litigation which do not require approval under s 60-10 of the IPSC; and he also identifies estimated future costs and remuneration within the “salvage” claim, which will be paid out of Court by reason of a separate judgment but are not addressed by this judgment. Mr Cook also claims additional remuneration in the amount of $223,200 (exclusive of GST) to 22 May 2020 which is not within the “salvage” claim, relating to creditor inquiries, adjudicating proofs of debt, meetings and general administration costs within the liquidation, which I address as part of the remuneration claim below.

I am satisfied that the remuneration, costs and expenses claimed by Mr Cook in the salvage claim are properly referable to the steps to which I referred above to protect and sell the Land and that he is entitled to recover that remuneration, costs and expenses from the sale proceeds of the Land, subject to approval of the proper quantum of his remuneration to 22 May 2020 to which I now turn.

Next, Mr Cook seeks approval of his remuneration under ss 60-5 and s 60-12 of the IPSC. Section 60-5 of the IPSC provides that an external administrator of a company is entitled to receive remuneration for necessary work properly performed by that external administrator in relation to the external administration, in accordance with any remuneration determinations for the external administrator made under s 60-10) of the IPSC.

Section 60-10 of the IPSC relevantly provides that:

Mr Golledge also draws attention to s 60-12 of the IPSC which provides that:

Mr Golledge also refers to observations of the Court of Appeal in Sanderson, as liquidator of Sakr Nominees Pty Ltd (in liq) v Sakr [2017] NSWCA 38; (2017) 118 ACSR 333, which recognise the relevance of “proportionality” in fixing a practitioner’s remuneration, and to the recognition by the Full Court of Federal Court in Templeton v Australian Securities & Investments Commission [2015] FCAFC 137; (2015) 108 ACSR 545 that proportionality is to be judged having regard to the complexity of the issues with which an insolvency practitioner had to deal. The Full Court there observed at [52] that:

In Re Banksia Securities Ltd (in liq) (recs and mgrs apptd) [2017] NSWSC 540, Gleeson JA, in dealing with a receiver’s claim for remuneration, noted that common bases for calculation of remuneration included time-based charging and a commission based on percentage of recoveries, and that the approach to be adopted is directed to securing reasonable remuneration in the circumstances. Gleeson JA there also referred to the Court of Appeal’s decision in Sanderson, as liquidator of Sakr Nominees Pty Ltd (in liq) v Sakr above and summarised the principles which arose from Bathurst CJ’s judgment in that case (at [44]-[46]) as follows:

Mr Golledge also refers to my decision in Re Sakr Nominees Pty Ltd [2017] NSWSC 668 at [23]-[25], where I referred to the position as it had developed following the Court of Appeal's decision in Sanderson, as Liquidator of Sakr Nominees Pty Ltd (in liq) v Sakr above. I there noted the relevance of proportionality in an application of this kind, and also noted that the majority of decisions had accepted that, at least in some circumstances, time costing may be an appropriate starting point for a calculation of remuneration, although the assessment of proportionality is important in testing the reasonableness of time-based remuneration. I noted that several cases had recognised the significance of the percentage that a liquidator's remuneration bears to the level of asset realisations achieved, but that is less relevant in a provisional liquidation, where the provisional liquidator would not be expected to, and indeed generally does not have power to, realise the company's assets. I also noted the recognition in the case law that work may be necessary, including in order to comply with a liquidator's or provisional liquidator's obligations, although it does not in fact generate any positive return to creditors, although that is far from the case here. Mr Golledge also points to the recognition in the case law that time costing can provide a useful and objective starting point for a claim to remuneration, although it may be necessary or appropriate to discount the amount claimed by an insolvency practitioner on a time costing basis by reference to other matters including the size of the recoveries or property dealt with by the practitioner: Re Clout [2016] NSWSC 1146 at [134]-[135].

It is not the Court’s role, as constituted by a judge in an application of this kind, to undertake a line by line review of the relevant narratives in an insolvency practitioner’s billing record, but the Court will generally review the relevant narratives in a broad way in order to satisfy itself that they support the other evidence led in respect of the claimed remuneration, and I have taken that course here: Re Idylic Solutions Pty Ltd as trustee for Super Save Superannuation Fund [2016] NSWSC 1292 at [58]; Re Banksia Securities Limited (in liq) (recs and mgrs apptd) [2018] NSWSC 229; Re Aberdeen All Farm Pty Ltd (in liq) above.

I have had regard to the matters specified by s 60-12 of the IPSC, including the period during which the work was, or is likely to be, performed by the external administrator under s 60-12(c) of the IPSC. Mr Golledge submits, and I accept, that Mr Cook’s claim for remuneration is strengthened because he was required to perform his work over a very considerable period before he was remunerated. The Court must also have regard under s 60-12(e)-(g) of the IPSC to the complexity (or otherwise) of the work performed, or likely to be performed, by the external administrator; any extent to which the external administrator was, or is likely to be, required to deal with extraordinary issues; and any extent to which the external administrator was, or is likely to be, required to accept a higher level of risk or responsibility than is usually the case. The evidence and the Court’s file demonstrates that this was an administration, and then a liquidation, of extraordinary complexity and the sale proceeds achieved for the land demonstrate, as Mr Golledge points out, the quality of the result achieved. That result is emphasised by the fact that, even after the amount of costs that will have been diverted to the defence of claims brought by third parties in the matter, all secured creditors will be paid on a sale of the Land, and there is a real prospect that unsecured creditors will achieve some return, and some possibility of a return to Fearndale’s shareholders or unitholders in the Trust. I accept that Mr Cook was also exposed to a significant level of risk in the conduct of the administration, where the value of the asset and the multiplicity of claims against it exposed him to repeated attack by parties with an interest in maximising their claim to the value of the Land.

As Mr Golledge points out, Mr Cook’s affidavit evidence indicates the basis of the calculation of his claim for remuneration, and deals with the identity and seniority of those within his firm who carried out the relevant work, their respective charge-out rates and the time taken for that work, and Mr Cook’s evidence as to those matters is in turn supported by detailed work-in-progress records. Mr Golledge submits, and I accept, that the nature of this administration and subsequently liquidation, with the very high degree of contention involved and the multiple claims to the Land, limited the amount of routine work which was capable of delegation to less senior staff. Mr Cook’s evidence is, and I accept, that the rates charged by his firm are consistent with hourly rates charged by other insolvency firms in the Sydney market (Cook 1.5.20 [83]). Mr Golledge also points out that, when a blended hourly rate is calculated, the amount derived is well within the range that would be allowed in a contentious insolvency: compare Australasian Barrister Chambers Pty Ltd [2019] NSWSC 799, which was another case in which an insolvency practitioner faced a high level of dispute in dealing with the relevant asset.

Mr Golledge acknowledges, rightly, that Mr Cook’s claim for remuneration is very substantial, but rightly also submits that does not mean that it is unreasonable in the extraordinary circumstances of this administration and liquidation. I am satisfied that the amount claimed represents reasonable remuneration for the work done, notwithstanding the size of the claim, in the difficult circumstances that Mr Cook faced, and given the result which was achieved, in large part, through his efforts and despite a multitude of third parties with interests in maximising their respective positions in respect of the proceeds of sale of the Land.

The Court makes the following orders and declaration: