Liquidator loses appeal against costs order in favour of Revenue

Liquidator loses appeal against costs order in favour of Revenue

An award of costs against a liquidator in favour of Revenue was today upheld by the Supreme Court.

The issue in the appeal related to the circumstances in which a liquidator may incur personal liability for costs on being removed for cause.

Anthony J Fitzpatrick had appealed a 2017 costs order which set down that Mr Fitzpatrick must pay half of the costs incurred by the Revenue Commissioners in relation to High Court proceedings taken against him around the liquidation of Ballyrider Ltd which began nine years ago.

Ballyrider Ltd owned a hotel in Co Kildare and the judgement said the hotel was the subject of a charge in favour of AIB which was owed in the region of €237,346.

Mr Fitzpatrick was appointed the voluntary liquidator in 2010 as the company was wound up and Revenue which was owed €109,000 was a preferential creditor.

The hotel was later sold and in 2015 the High Court ordered that Mr Fitzpatrick be removed as liquidator. MrFitpatrick appealed that decision and lost.

Giving the judgement of the five judge court today Mr Justice William McKechnie said even though there was no finding of negligence or misconduct against Mr Fitzpatrick the High Court as affirmed on appeal was satisfied by reason of his failure to conduct litigation in an efficient and cost effective manner, he should be removed as liquidator.

The judge said it was only fair to say or to acknowledge that the trial judge also said that if at the hearing Mr Fitzpatrick had produced a detailed account and a credible plan to progress and complete liquidation she may not necessarily have made the order which she did.

In the absence of those however his appointment was terminated.

Mr Justice McKechnie said in this case the position of liquidator was directly in issue and he was therefore satisfied the normal rules would apply and that if otherwise justified in so doing, an order for costs in favour of Revenue could be made. The approach of the Court of Appeal the judge said was unimpeachable and and he was entirely satisfied that the outcome at an individual level was appropriately reached on the correct principles which were properly applied.

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