The complaint was that Mr Paylor, acting in his capacity as administrator having issued his first notification to creditors on 22 May 2013 advising of his appointment and of the pre-packaged sale of the assets, failed to comply with SIP 16 and/or the guidance to compliance with SIP 16 as set out in Dear IP 42 issued in October 2009 in that:
- The extent of the administrators prior involvement was not sufficiently explained;
- Insufficient information was given as to the administrator’s initial introduction;
- Details of any marketing activity carried out by the administrator and the company were not sufficiently disclosed;
- The breakdown of the overall asset valuation across individual asset categories was not provided;
- The apportionment of the sales consideration across individual asset categories was not disclosed preventing creditors comparing realisations to valuations obtained;
- No or insufficient information was provided on the alternative courses of action that were considered by the administrator along with an explanation of possible financial outcomes;
- Failed to, or sufficiently clarify, whether there was any connection between the purchaser and the directors, shareholders and secured creditors of the company or whether any of the company directors, or former directors are involved in the management or ownership of the purchaser.
Full details of the sanctions are attached above.
Guide to insolvency practitioner disciplinary sanctions