As a part of our regulatory role, we consider applications to determine the remuneration of trustees. Recent applications have shown that trustees have failed to appropriately account for remuneration in joint and separate estates.
Insolvency practitioners are reminded of the following key points:
- to ensure they apply sections 110 and 142 of the Bankruptcy Act 1966.
- expenses relating to the administration of estates must be fairly apportioned by the trustee between the joint and separate estates
- failing to identify and appropriately account for joint and separate estates can have a material impact for stakeholders.
Section 4 of the Inspector-General Practice Direction 18 - Trustee remuneration notifications explains that the trustee’s obligation to send remuneration notifications is estate based. At section 4.2, it states that it is acceptable for a trustee to send a joint report to creditors, with estate-based remuneration notices dealt with separately.
For more information, read this article.