Our website is set to allow the use of cookies. For more information and to change settings click here. If you are happy with cookies please click "Continue" or simply continue browsing. Continue.

Insolvency Law

Expert guidance on all aspects of corporate and personal insolvency

22 MAR 2010

Portsmouth Insolvency Practitioner (IP) in the firing line

The high profile nature of a number of recent insolvencies, particularly football clubs and high street retailers, has put insolvency procedures and Insolvency Practitioners (IPs) in sharp focus. A story in yesterday's Sunday Times newspaper has highlighted some damaging comment made judicially against Portsmouth Football Club's administrator, Mr Andrew Andronikou. In relation to a failed IVA for the Joe Bloggs founder a Deputy High Court Judge noted:

“Mr Andronikou’s conduct in these proceedings, particularly in relation to evidence filed by him on behalf [of Ahmed and his family], was manifestly inappropriate.” ...Andronikou “did fail to meet the standard to be expected of a reasonably competent insolvency practitioner”.
The retort from the embattled IP was quite fruity according to the Sunday Times. The paper notes:
"Andronikou told The Sunday Times that the vote-rigging allegation was “absolute bollocks” and explained he had relied on his underlings to assess the validity of the Ahmed family claims."
Is Mr Andronikou accusing the judge of speaking "absolute bollocks"? This is a strong view of a long and forensic 256 paragraph judgment. If it is "bollocks" why did Mr Andronikou not appeal? Furthermore, it would be interesting to know if Mr Andronikou's Recognised Professional Body (RPB) investigated his activity following this case, and if not why not? The judgment in question is that of Mr Andrew Simmonds QC (sitting as a Deputy High Court judge) in Tradition (UK) Ltd v Ahmed & Ors [2008] EWHC 2946 (Ch) (05 December 2008). A particular specialism of the silk is professional negligence. The salient part of the judgment is:
"However, Mr Andronikou's conduct during the proceedings , particularly in relation to the evidence filed by him on the Respondents' behalf, was manifestly inappropriate, as is effectively conceded. I refer to the observations of Jacob LJ in Smurthwaite v Simpson-Smith [2006] BPIR 1504 at 1524:

"One of the difficulties in this case stems from the fact that Mr Mond, the insolvency practitioner, made common cause with the debtor. There is inherent danger in adopting any such stance. Insolvency practitioners should be much more careful to preserve utter independence from any party, either the debtor or any creditor."

The principal question here is whether I should accede to Mr Tager's submission that Mr Andronikou should be excused because everything he did by way of filing evidence was based on legal advice.The problem with that submission is that there is no evidence before the Court as to precisely what that advice was or whether, and to what extent, Mr Andronikou queried it. I say that because Mr Andronikou is an experienced insolvency practitioner and I would have expected his instinct to be that it was not appropriate for him to provide the lead evidence on behalf of the Respondents in relation to the disputed debts issue. Not only did he not have the relevant knowledge to give the Court any real assistance but it obviously made him appear partisan.I note that when a similar defence was run in Smurthwaite at first instance, the insolvency practitioner in question adduced evidence giving particulars of the legal advice provided: see [2006] BPIR 1483 at 1500. In the circumstances I am not prepared to accept that Mr Andronikou should be excused from what would otherwise be an adverse finding by reason of reliance on legal advice.Conclusion In summary, therefore,(1) I find that Mr Andronikou did fail to meet the standard to be expected of a reasonably competent insolvency practitioner in preparing his Nominee's Report dated 8 March 2007 and in his conduct during these proceedings ; but(2) I reject Tradindex's allegation against Mr Andronikou in relation to his conduct of the creditors' meeting on 29 March 2007.I emphasise that, at this stage, I am only making findings as to Mr Andronikou's conduct . I express no view on the question whether it would be appropriate for Mr Andronikou to be ordered to pay any part of Tradindex's costs of these proceedings . That will depend on additional considerations upon which I have yet to be addressed."
Mr Andronikou has come under fire before in the courts in relation to allegedly negligent advice. See: Griffin v UHY Hacker Young & Partners (A Firm) [2010] EWHC 146 (Ch) (04 February 2010).

Bankruptcy and Personal Insolvency Reports

Bankruptcy and Personal Insolvency Reports

"BPIR is an excellent series, of interest to both corporate and personal insolvency lawyers,...

More Info from £166.00
Available in Insolvency Law Online
Individual Voluntary Arrangements

Individual Voluntary Arrangements

"This is the ultimate statement of where the law on IVAs is to be found in our great common law...

Available in Insolvency Law Online
Subscribe to our newsletters