Court provides new guidance on irregular out of court appointment of administrators

14 August 2012

The High Court has handed down judgment in Re Euromaster Ltd [2012] EWHC 2356 (Ch) in which Daniel Warents appeared for the Applicants. Norris J confirmed that the appointment of an administrator had taken effect even though the notice of appointment had been filed with the court more than 10 business days after a notice of intention to appoint an administrator had been filed with the court in breach of paragraph 28(2) of Schedule B1 to the Insolvency Act 1986.

This case is significant because of Norris J’s careful analysis of the existing case law on the distinction between an irregular out of court appointment of an administrator (where the appointment does take effect) and a null appointment (where it does not). Also of importance was Norris J’s decision that where an appointment is irregular the Court has a discretion to set that appointment aside where there is an objection and also his contemplation of the possibility that such an irregularity could, in an appropriate case, be waived. In a judgment which may have wider implications for irregular rout of court appointments, Norris J indicated his preference for a discretion based approach to irregular appointments rather than the alternative of making an administration order with retrospective effect, describing such retrospective appointments as ‘artificial’.