Factual and Procedural Background
The case concerns whether a receiver appointed under the Criminal Justice Act 1988 can recover remuneration, disbursements, and expenses for work done after the receivership order has been discharged. The receiver, a chartered certified accountant and licensed Insolvency Practitioner, was appointed in February 2001 over the assets of a solicitor convicted of money laundering and subject to a confiscation order. The receivership involved significant assets and complex litigation, including disputes over asset ownership and enforcement of the receiver's lien.
Following the discharge of the receivership order in April 2006, disputes continued regarding the receiver's entitlement to remuneration and costs incurred post-discharge. The receiver sought detailed assessment and permission to realise assets to meet his remuneration claims, including work done after discharge. The court made several orders, notably on 14 December 2010 and 29 June 2012, affirming that the receiver was entitled to remuneration, expenses, and disbursements incurred post-discharge, payable from the receivership assets and subject to the receiver's lien. The interveners challenged these orders, leading to the present appeal.
Legal Issues Presented
- Does the Order of 14 December 2010 (as affirmed by the Order of 29 June 2012) permit the receiver to recover post-discharge remuneration, expenses, and disbursements out of the receivership assets?
- Can the interveners now argue that the court lacks power to order payment of post-discharge remuneration, expenses, and disbursements?
- If such an argument can be raised, did the court have jurisdiction to order payment of post-discharge remuneration, expenses, and disbursements from the receivership assets?
Arguments of the Parties
Appellants' Arguments
- The receiver cannot recover remuneration, disbursements, and expenses for work done after the receivership order was discharged.
- There is no authority supporting recovery of remuneration post-discharge or a lien over assets for costs incurred enforcing the lien.
- The discharge order did not expressly sanction payment of post-discharge remuneration.
- The receiver should seek indemnity for post-discharge costs from the original appointor, not from the receivership assets.
- The court lacks jurisdiction to order payment for post-discharge remuneration, expenses, and disbursements.
- The receiver could have ensured his remuneration by requiring discharge orders to be conditional on concluding all outstanding matters.
Respondent Receiver's Arguments
- The receiver is entitled to recover remuneration, expenses, and disbursements for work done post-discharge out of the receivership assets.
- The interveners cannot raise the jurisdictional argument on appeal as it was effectively disclaimed or not raised at the original hearing where the issue could have been addressed.
- The receiver has acted to his detriment in reliance on the court's orders permitting post-discharge remuneration claims.
- The receiver continues to be an officer of the court after discharge, performing functions necessary to conclude the receivership, which justifies recovery of remuneration.
- Common law principles and court rules support the receiver's entitlement to remuneration and expenses post-discharge.
- The court retains supervisory jurisdiction over the receiver after discharge to approve remuneration and expenses.
- The receiver's remuneration and costs are subject to court approval, protecting the interests of the parties affected.
Table of Precedents Cited
| Precedent |
Rule or Principle Cited For |
Application by the Court |
| Pittalis v Grant [1989] QB 605 |
Procedural principle restricting raising new points on appeal not raised below unless certain conditions are met. |
Used to reject the interveners' attempt to raise a jurisdictional argument not raised at the original hearing, emphasizing fairness and detriment to the receiver. |
| Macdougall v Knight (1889) 14 App. Cas. 194 |
General principle on appellate courts' approach to points not raised at trial. |
Referenced in support of procedural fairness in appellate consideration. |
| The Tasmania (1890) 15 App. Cas. 223 |
Similar procedural principle regarding points not raised at trial. |
Referenced alongside Macdougall v Knight. |
| Ex parte Firth, In re Cowburn (1882) 19 ChD 419 |
Requirement to raise points at trial to allow evidence and avoid injustice. |
Supported the procedural bar on raising new points on appeal. |
| Capewell v Revenue and Customs Commissioners [2007] UKHL 2 |
Receivers appointed under the Criminal Justice Act 1988 act as officers of the court under common law unless the Act provides otherwise. |
Supported the principle that the receiver remains subject to court supervision post-discharge. |
| Mellor v Mellor [1992] 1 WLR 517 |
A receiver's right to indemnity and lien over assets survives discharge of the receivership order. |
Confirmed that the receiver's lien and right to remuneration can continue post-discharge. |
| Re Andrews [1999] 1 WLR 1236 |
Similar principle regarding receiver's lien and indemnity surviving discharge. |
Reinforced the continuation of lien rights post-discharge. |
| Sinclair v Glatt [2009] EWCA Civ 176 |
Remuneration costs reasonably incurred up to discharge date are chargeable to receivership assets. |
Clarified that costs after discharge were not debated and thus did not preclude post-discharge claims. |
| Crown Prosecution Service v Eastenders Group Ltd [2012] EWCA Crim 2436 |
Obiter remark suggesting no recovery for acts after receivership ends. |
Distinguished as not binding and not agreed by all judges; did not decide the present issue. |
| Glatt v Sinclair [2010] EWHC 3069 (Admin) |
A receiver post-discharge remains an officer of the court for concluding receivership affairs, including legal costs. |
Supported the principle that post-discharge work related to receivership administration can be remunerated. |
| Boehm v Goodall [1911] 1 Ch 155 |
Receivers are not trustees or agents of parties and must look to receivership assets for indemnity; parties are not personally liable for receiver's expenses. |
Supported the principle that the receiver’s indemnity comes from receivership assets, not from parties personally. |
| McCracken v Crown Prosecution Service [2011] EWCA Civ 1620 |
Interpretation of court rules regarding receivership discharge and duties. |
Supported that court rules on receivership discharge are not exhaustive and receivers may have ongoing duties post-discharge. |
Court's Reasoning and Analysis
The court first interpreted the Order of 14 December 2010, as affirmed on 29 June 2012, to include remuneration, expenses, and disbursements incurred post-discharge, based on the submissions and the wording of the order. The court noted that leading counsel for the party opposing the receiver accepted the principle of post-discharge remuneration, limiting their argument to the amount claimed.
On the procedural issue, the court held that the interveners could not raise the jurisdictional argument on appeal because it was not raised at the original hearing when it could have been addressed. The receiver had acted to his detriment in reliance on the court’s orders permitting post-discharge remuneration claims, and the opposing party had effectively adopted the arguments allowing such claims. The court relied on established appellate principles restricting raising new points not raised below unless exceptional circumstances exist.
Substantively, the court held that the receiver, as an officer of the court, continues post-discharge to perform functions necessary to conclude the receivership. Common law principles and court rules support the right to recover remuneration and expenses incurred in this process. The court found no principled basis to deny recovery of remuneration for post-discharge services necessary to wind up the receivership. The receiver’s remuneration and expenses remain subject to court approval, providing adequate protection to the parties.
The court rejected the appellants’ argument that the receiver should be limited to remuneration incurred only during the active receivership, noting that the discharge order and original receivership order were silent on this point. The court also rejected the suggestion that the receiver should seek indemnity from the original appointor for post-discharge costs, emphasizing that the receiver looks to the receivership assets under court supervision.
Further, the court noted that requiring conditional discharge orders to cover all outstanding matters would be impractical and contrary to the scheme of the court rules. The court also observed that disallowing post-discharge remuneration could lead to inefficient and costly delegation to external lawyers, increasing costs unnecessarily.
Finally, the court emphasized that the party subject to the receivership order is protected by the court’s supervisory jurisdiction, which can disallow unreasonable or disproportionate remuneration and expenses.
Holding and Implications
The court DISMISSED THE APPEAL on all grounds.
The holding confirms that a receiver appointed under the Criminal Justice Act 1988 may recover remuneration, expenses, and disbursements for work done after the receivership order has been discharged, provided the court approves such claims. The receiver remains an officer of the court post-discharge with continuing duties to conclude the receivership and is entitled to indemnity from the receivership assets for reasonable remuneration and expenses incurred in that process. The decision reinforces the court's supervisory role and procedural principles limiting the raising of new points on appeal when they were not raised at trial. No new precedent was created beyond affirming existing principles applied to the facts of this case.