Form 4.20 Rule 4.34-CVL The Insolvency Act 1986 Statement of Company’s S 9 5 /9 9Q Affairs e Pursuant to Section 95/99 of the Insolvency Act 1986 For official use To the Registrar of Companies Company Number 08146793 Name of Company (a) Insert full (a) 2 AFFINITY LIMITED name of Company (b) Insert full I, (b) Raymond Stuart Claughton name(s) and 3 Merchant’s Quay address(es) Ashley Lane Shipley BD17 7DB (c) Insert date _— the liquidator of the above named company attach a statement of the company’s affairs as at (ec) 1° May 2015 Signed Jc _— Date 1 May 2015 For Official Use Presenter’s name, Rushtons Insolvency Liquidation Section Post Room address and reference Limited (if any) 3 Merchant’s Quay , Ashley Lane ' . > | Shipley < BD17 7DB 5 | | | ll | / | < *A46JWUEA* RSC/RJ/LB Att 02/05/2015 #189 j COMPANIES HOUSE Rule 4 34-CVL Form 4 19 Statement of Affairs (TITLE) Statement as to affairs of 2 Affinity Limited on the 1 May 2015 being a date not more than 14 days before the date of the resolution for winding up ~ Statement of truth I believe that the facts stated in this Statement of Affaurs are true. Full name: Wayne Michael Elliott Signed Noy puBk © Dated: 1% May 2015 A-—Summary of Assets Assets Book Estimated to Value Realise Assets specifically pledged:- £ £ Nil Assets not specifically pledged:- Equipment 261 -- Director’s Loan Account 49,854 25,000 Estimated total assets available for preferential Creditors 50,115 25,000 Signature: Date: 15t May 2015 Al - Summary of Liabilities Estimated to realise £ Estimated total assets available for Preferential Creditors (carried from page A) 25,000 Liabilities Preferential Creditors:- £ Nil | Nil Estimated surplus as regards Preferential Creditors 25,000 Estimated prescribed part of net property available to non-preferential Creditors where applicable (to carry forward) -- Debts secured by a floating charge:- £ Nil -- Estimated surplus of assets available for non-preferential Creditors £ 25,000 Estimated prescribed part of net property available to Non-preferential Creditors where applicable (brought down) £ -- Non-preferential claims:- £ Trade & Expense 1,600 HM Revenue & Customs 49,000 50,600 Estimated deficiency as regards Creditors (25,600) Issued and called up capital:- £ 100 Ordinary Share of £1 each 100 (100) Estimated total deficiency as regards members (25,700) Signature Date 15* May 2015 . COMPANY CREDITORS NOTE You must identify Creditors under Hire Purchase, Chattel Leasing or Conditional Sale Agreements and Customers claiming amounts paid in advance of the supply of goods or services and Creditors claiming Retention of Title over property in the Company’s possession Name of Creditor Amount of Details of any Date Security Value of or Claimant and Debt Security held given Security Address by Creditor Bl NON-PREFERENTIAL 1) Baker Fox Limited Owl Cotes Barn Low Lane Cowling Keighley BD22 OLE 1,500 Nil 2) Fuel Geme (UK) Limited PO Box 6139 1 Trimty Court Broadlands Wolverhampton WV113RQ 100 Nil 3) HM Revenue & Customs Insolvency Claims Handling Umt (CHU) Benton Park View Longbenton Newcastle upon Tyne NE98 1ZZ 49,000 Nil Signature: Date: 15* May 2015 STATEMENT OF INSOLVENCY PRACTICE 9 (E & W) A CREDITORS’ GUIDE TO LIQUIDATORS’ FEES ENGLAND AND WALES Introduction il When a company goes into liquidation the costs of the proceedings are paid out of its assets The creditors, who hope to recover some of their debts out of the assets, therefore have a direct interest in the level of costs and in particular the remuneration of the insolvency practitioner appointed to act as liquidator The insolvency legislation recognises this mterest by providing mechanisms for creditors to fix the basis of the liquidator’s fees This guide 1s intended to help creditors be aware of their rights to approve and monitor fees, explains the basis on which fees are fixed and how creditors can seek information about expenses incurred by the liquidator and challenge those they consider to be excessive Liquidation procedure 21 Liquidation (or ‘winding up’) 1s the most common type of corporate insolvency procedure Liquidation 1s the formal winding up of a company’s affairs entailing the realisation of its assets and the distribution of the proceeds in a prescribed order of priority Liquidation may be either voluntary, when it 1s instituted by resolution of the shareholders, or compulsory, when tt ts instituted by order of the court 22 Voluntary liquidation 1s the more common of the two An insolvent voluntary liquidation 1s called a creditors’ voluntary liquidation (often abbreviated to ‘CVL’) In this type of hquidation an insolvency practitioner acts as hquidator throughout and the creditors can vote on the appointment of the liquidator at the first meeting of creditors 23 in a compulsory hquidation on the other hand, the function of liquidator 1s, 1n most cases, initially performed not by an msolvency practitioner but by an official called the official receiver The official receiver 1s an officer of the court and an official belonging to the Insolvency Service In most compulsory liquidations, the official receiver becomes liquidator ammediately on the making of the winding-up order Where there are significant assets an insolvency practitioner will usually be appointed to act as liquidator in place of the official receiver, erther at a meeting of creditors convened for the purpose or directly by The Insolvency Service on behalf of the Secretary of State Where an insolvency practitioner ts not appointed the official receiver remams liquidator 24 Where a compulsory tiquidation follows immediately on an administration the court may appoint the former administrator to act as liquidator In such cases the official receiver does not become liquidator An admunistrator may also subsequently act as liquidator in a CVL The liquidation committee 31 Ina liquidation (whether voluntary or compulsory) the creditors have the mght to appoint a commuttee called the liquidation commuttce, with a minimum of 3 and a maximum of 5 members, to monitor the conduct of the liquidation and approve the liquidator’s fees The commuttee ts usually established at the creditors’ meeting which appoints the liquidator, but in cases where a liquidation follows immediately on an admimstration any commuttee established for the purposes of the administration will continue in being as the liquidation committee 32 The liquidator must call the first meeting of the committee within 6 weeks of its establishment (or his appointment if that 1s later) and subsequent meetings must be held either at spectfied dates agreed by the committee, or when requested by a member of the committee, or when the liquidator decides he needs to hold one The liquidator 1s required to 1eport to the committee at least every 6 months on the progress of the liquidation, unless the commuttee directs otherwise This provides an opportunity for the committee to monitor and discuss the progress of the insolvency and the level of the |iquidator’s fees Fixing the liquidator’s remuneration 41 The basis for fixing the lnquidator’s remuneration 1s set out 1p Rules 4 127 - 4 127B of the Insolvency Rules 1986 The Rules state that the remuneration shall be fixed . as a percentage of the value of the assets which are realised or distributed or both, . by reference to the tume properly given by the liquidator and his staff m attending to matters arising in the liquidation, or . as a set amount Any combination of these bases may be used to fix the remuneration and different bases may be used for different things done by the liquidator Where the remuneration 1s fixed as a percentage, different percentages may be used for different things done by the liquidator It 1s for the liquidation committee (if there 1s one) to determme on which of these bases, or combination of bases, the remuneration is to be fixed Where it 1s fixed as a percentage, it 1s for the committee to determme the percentage or percentages to be apphed Rule 4 127 says that in arriving at its decision the commuttee shall have regard to the following matters the complexity (or otherwise) of the case, any responsibility of an exceptional kind or degree which falls on the liquidator in connection with the insolvency, the effectiveness with which the liquidator appears to be carrying out, or to have carried out, his duties, the value and nature of the assets which the liquidator has to deal with 42 If there 1s no liquidation committee, or the committee does not make the requisite determination, the liquidator’s remuneration may be fixed by a resolution of a meeting of creditors The creditors take account of the same matters as apply in the case ofthe committee A resolution specifying the terms on which the liquidator 1s to be remunerated may be taken at the meeting, which appoints the liquidator 43 If the remuneration ts not fixed as above, it will be fixed in one of the following ways In aCVL, 1t will be fixed by the court on application by the Inquidator, but the liquidator may not make such an application unless he has first tned to get his remuneration fixed by the committee or creditors as described above and in any case not later than 18 months after his appointment In a compulsory liquidation, 1t will be in accordance with a scale set out in the Rules 44 Where the liquidation follows directly on from an administration i which the liquidator had acted as administrator, the basis of remuneration fixed in the administration continues to apply in the liquidation (subject to paragraph 8 below) Review of remuneration Where there has been a material and substantial change in circumstances since the basis of the lquidator’s remuneration was fixed, the liquidator may request that tbe changed The request must be made to the same body as mmttally approved the remuneration and the same rules apply as to the original approval What information should be provided by the liquidator? When seeking remuneration approval When seeking agreement to his fees the liquidator should provide sufficient supporting information to enable the committee or the creditors to form a judgement as to whether the proposed fee is reasonable having regard to all the circumstances of the case The nature and extent of the supporting imformation which should be provided will depend on ° the nature of the approval bemg sought, . the stage during the admumistration of the case at which it 1s being sought and ° the size and complexity of the case Where, at any creditors’ or committee meeting, the liquidator seeks agreement to the terms on which he 1s to be remunerated, he should provide the meeting with details of the charge-out rates of all grades of staff, including principals, which are likely to be involved on the case Where the liquidator seeks agreement to his fees durmg the course of the liquidation, he should always provide an up to date receipts and payments account Where the proposed fee 1s based on time costs the liquidator should disclose to the commuttee or the creditors the time spent and the charge-out value in the particular case, together with, where appropriate, such additional formation as may reasonably be required having regard to the size and complexity of the case The additional information should comprise a sufficient explanation of what the liquidator has achteved and how it was achieved to enable the value of the exercise to be assessed (whilst recognising that the hquidator must fulfil certain statutory obligations that might be seen to bring no added value for creditors) and to establish that the time has been properly spent on the case That assessment will need to be made having iegard to the time spent and the 1ates at which that time was charged, bearing in mind the factors set out in paragraph 4 1 above To enable this assessment to be carried out it may be necessary for the liquidator to provide an analysis of the time spent on the case by type of activity and grade of staff The degree of detail will depend on the circumstances of the case, but it will be helpful to be aware of the professional guidance which has been given to insolvency practitioners on this subject. The guidance suggests the following areas of activity as a basis for the analysis of time spent . Admunistration and planning . Investigations . Realisation of assets . Trading . Creditors . Any other case-specific matters The following categories are suggested as a basis for analysis by grade of staff ° Partner/Director . Manager . Other senior professionals . Assistants and support staff The explanation of what has been done can be expected to clude an outlme of the nature of the assignment and the liquidator’s own. initial assessment, including the anticipated return to creditors To the extent applicable it should also explain Any significant aspects of the case, particularly those that affect the amount of tme spent. The reasons for subsequent changes 1n strategy Any comments on any figures in the summary of time spent accompanying the request the liquidator wishes to make The steps taken to establish the views of creditors, particularly 1n relation to agreeing the strategy for the assignment, budgeting, tume recording, fee drawing or fee agreement ° Any existing agreement about fees . Details of how other professionals, including subcontractors, were chosen, how they were contracted to be paid and what steps have been taken to review their fees It should be bome m mind that the degree of analysis and form of presentation should be proportionate to the size and complexity of the case In smaller cases not all categories of activity will always be relevant, whilst further analysis may be necessary in larger cases 614 Where the fee 1s charged on a percentage basis the lnquidator should provide details of any work which has been or 1s intended to be sub- contracted out which would normally be undertaken directly by a liquidator or his staff 62 After remuneration approval Where a resolution fixing the basis of fees 1s passed at any creditors’ meeting held before he has substantially completed his functions, the hquidator should notrfy the creditois of the details of the resolution in his next report or cncular to them =When subsequently reporting to creditors on the progress of the liquidation, or submitting hus final report, he should specify the amount of remuneration he has drawn in accordance with the resolution (see further paragraph 7 1 below) Where the fee 1s based on time costs he should also provide details of the time spent and charge-out value to date and any material changes in the rates charged for the various grades since the resolution was first passed He should also provide such additional information as may be required in accordance with the principles set out m paragraph 613 Where the fee 1s charged on a percentage basis the liquidator should provide the details set out in paragraph 6 14 above regarding work, which has been sub-contracted out 63 Disbursements and other expenses There 1s no statutory requirement for the committee or the creditors to approve the drawing of expenses or disbursements, but there 1s provision for the creditors to challenge them, as described below Professional guidance issued to insolvency practitioners requires that, where the liquidator proposes to recover costs which, whilst bemg in the nature of expenses or disbursements, may include an element of shared or allocated costs (such as room hire, document storage or communication facilities provided by the liquidator’s own firm), they must be disclosed and be authorised by those responsible for approving his remuneration Such expenses must be directly incurred on the case and subject to a reasonable method of calculation and allocation 631 Approval 1s not required for the drawing of necessary disbursements However, not all costs properly charged in connection with insolvency assignments may necessarily be regarded as disbursements The precise demarcation line between disbursements and remuneration 1s not defined by statute and has not been specifically determined by the courts Particular difficulties arise in connection with charges that involve calculations of shared and overhead costs, as these may include an element of remuneration 632 In the absence of a clear statutory definition only those costs that clearly meets the definition of disbursements, where there 1s specific expenditure relatmg to the administration of the isolvent’s affairs and referable to payment to an independent third party, are treated as disbursements recoverable without approval In this statement these are referred to as ‘category 1 disbursements’ (approval not required) Category 1 disbursements will generally comprise external supplies of incidental services specifically identifiable to the case, typically for rtems such as identifiable telephone calls, postage, case advertising, invoiced travel and properly re:mbursed expenses incurred by personnel in connection with the case Also included will be services specific to the case where these cannot practically be provided internally such as printing, room hire and document storage Practitioners should be prepared to disclose information about specific category I disbursements where reasonably requested in all cases 633 Where it 1s proposed to recover costs which, whilst bemg in the nature of expenses or disbursements, include elements of shared or allocated costs, they should be identified and subject to approval by those responsible for approving remuneration If the office holder wishes to make a separate charge for expenses in this second category, he may do so provided that * such expenses are of an incidental nature and are directly incurred on the case and there 1s a reasonable method of calculation and allocation, it will be persuasive evidence of reasonableness, if the resultant charge to creditors ts in Ine with the cost of external provision, and . the basis of the proposed charge 1s disclosed and 1s authorised by those responsible for approving his remuneration These are defined as category 2 disbursements (approving required) Category 2 disbursements will comprise cost allocations, which may arise on some of the category 1 expense where supplied internally typically, items such as room hire and document storage Also typically included will be routme or more specialist copying and printing and allocated communication costs provided by the practitioner or his firm 634 A charge for disbursements calculated as a percentage of the amount charged remuneration 1s not permissible 635 Basic non-incidental costs, including such stems as time costs, office and equipment rental, depreciation, standing charges, finance charges, accounting and admmustration costs, may not be the subject of separate charges 636 Payments to outside parties in which the office holder or his firm or any assoctate (as defined by section 435 of the Insolvency Act 1986) has an interest should be treated as category 2 disbursements 637 Where, in a liquidation or a bankruptcy, remuneration ts being taken on the statutory scale and there 1s no committee and it has not been possible to obtam a resolution of the creditors, category 2 disbursements may only be recovered sf authorised by the creditors 638 It 1s the office holder’s obligation to satisfy himself of the appropriateness of disbursements and the office holder should bear im mund the matters referred to in paragraph 4 2 above 64 Realisations for secured creditors Where the liquidator realises an asset on behalf of a secured credhtor and receives remuneration out of the proceeds (see paragraph 111 below), he should disclose the amount of that remuneration to the commuttee (if there 1s one), to any meeting of creditors convened for the purpose of determining hus fees and 1n any reports he sends to creditors 7 Progress reports and requests for further information 71 The liquidator 1s required to send annual progress reports to creditors The reports must include ° details of the basis fixed for the remuneration of the liquidator (or if not fixed at the date of the report, the steps taken during the period of the report to fix it), ° if the basis has been fixed, the remuneration charged during the period of the report, respective of whether 1t was actually paid during that period (except where tt 1s fixed as a set amount, m which case 1t may be shown as that amount without any apportionment for the period of the report), . 1f the report 1s the first to be made after the basis has been fixed, the remuneration charged during the periods covered by the previous reports, together with a description of the work done during those periods, irrespective of whether payment was actually made during the period of the report, . a statement of the expenses incurred by the liquidator during the period of the report, irrespective of whether payment was actually made during that penod, . a statement of the creditors’ nghts to request further information, as explamed im paragraph 7 2 and their right to challenge the liquidator’s remuneration and expenses 72 Within 21 days of receipt of a progress report (or 7 business days where the report has been prepared for the purposes of a meeting to receive the hquidator’s resignation) a creditor may request the hquidator to provide further information about the remuneration and expenses set out i the report A request must be in writing and may be made either by a secured creditor, or by an unsecured creditor with the concurrence of at least 5% im value of unsecured creditors (including himself) or the permission of the court 73 The liquidator must provide the requested information within 14 days, unless he considers that ° the time and cost mvolved in preparing the information would be excessive, or . disclosure would be prejudicial to the conduct of the liquidation or might be expected to jead to violence against any person, or . the liquidator 1s subject to an obligation of confidentiality in relation to the information requested, 1m which case he must give the reasons for not providing the information Any creditor may apply to the court with 21 days of the liquidator’s refusal to provide the requested information, or the expiry of the 14 days time limit for the provision of the information Provision of mformation — additional requirements The liquidator must provide certain information about the time spent on the case, free of charge, upon request by any creditor, director or shareholder of the company The information which must be provided 1s — . the total number of hours spent on the case by the liquidator or staff assigned to the case, ° for each giade of staff, the average hourly rate at which they are charged out, ° the number of hours spent by each grade of staff 1n the relevant period The period for which the information must be provided 1s the period from appointment to the end of the most recent period of six months reckoned from the date of the liquidator’s appomtment, or where he has vacated office, the date that he vacated office The information must be provided within 28 days of recespt of the request by the hquidator and requests must be made within two years from vacation of office What if a creditor is dissatisfted? 91 Except in cases where there 1s a Inquidation commuttee 1t 1s the creditors as a body who have authority to approve the liquidator’s fees To enable them to carry out this function they may require the liquidator to call a creditors’ meeting In order to do this at least ten per cent in value of the creditors must concur with the request, which must be made to the liquidator m writing 92 Ifa creditor belreves that the liquidator’s remuneration 1s too high, the basis 1s appropriate, or the expenses incurred by the liquidator are in all the cucumstances excessive he may, provided certain conditions are met, apply to the court 93 Application may be made to the court by any secured creditor, or by any unsecured creditor provided at least 10 per cent in value of unsecured creditors (including himself) agree, or he has the permission of the court Any such application must be made within 8 weeks of the applicant recetving the liqurdator’s progress report im which the charging of the remuneration or incurring of the expenses in question 1s first reported (see paragraph 7 1 above) If the court does not dismiss the application (which it may if xt constders that insufficient cause is shown) the applicant must give the liquidator a copy of the application and supporting evidence at least 14 days before the hearing 94 If the court considers the application well founded, it may order that the remuneration be reduced, the basis be changed, or the expenses be disallowed or repaid Unless the court orders otherwise, the costs of the application must by paid by the applicant and not out of the assets of the insolvent company 10 What if the lquidater ts dissatisfied? If the liquidator considers that the remuneration fixed by the commuttce, or in the preceding admunistration, 1s insufficient or that the basis used to fix its mappropriate he may request that the amount or rate be increased, or the basis changed, by resolution of the creditors Ifhe considers that the remuneration fixed by the hquidation commuttee, the creditors, in the preceding administration or in accordance with the statutory scale is sufficient, or that the basis used to fix it 1s inappropriate, he may apply to the court for the amount or rate to be mcreased or the basis changed If he decides to apply to the court he must give at least 14 days’ notice to the members of the committee and the committee may nomunate one or more of 1ts members to appear or be represented at the court hearing If there 1s no commuttee, the liquidator’s notice of his application must be sent to such of the creditors as the court may direct and they may nominate one or more of ther number to appear or be represented The court may order the costs to be paid out of the assets 11 Other matters relating to remuneration Wi Where the hquidator realises assets on behalf of a secured creditor he 1s entitled to be remunerated out of the proceeds of sale in accordance with the scale set out in the Rules Usually, however, the liquidator will agree the basis of his fee for dealing with charged assets with the secured creditor concerned 112 Where two (or more) joint lquidators are appointed 11 1s for them to agree between themselves how the remuneration payable should be apportioned Any dispute between them may be referred to the court, the committee or a meeting or creditors 113 If the appointed liquidator 1s a solicitor and employs his own firm to act m the msolvency, profit costs may not be pard unless authorised by the committee, the creditor or the court 114 If a new hquidator 1s appointed in place of another, any determination, resolution or court order which was 1n effect mmediately before the replacement contmues to have effect 1n relation to the remuneration of the new liquidator until a further determination, resolution or court order 1s made Where the basis of the remuneration 1s a set amount and the liquidator ceases to act before the time has elapsed or the work has been completed for which the amount was set, application may be made for a determination of the amount that should be paid to the outgoing liquidator The application must be made to the same body as approved the remuneration Where the outgomg liquidator and the mcomung liquidator are from the same firm, they will usually agree the apportionment between them 116 There may also be occasions when creditors will agree to make funds available themselves to pay for the liquidator to carry out tasks which cannot be paid for out of the assets, either because they are deficient or because 1t 1s uncertain whether the work undertaken will result m any benefit to creditors Arrangements of this kind are sometimes made to fund litigation or mvestigations ito the affairs of the insolvent company Any arrangements of this nature will be a matter for agreement between the hiquidato1 and the creditors concerned and will not be subject to the statutory rules relating to remuneration 12 Ettective Date This guide apphes where a company — ° goes into liquidation on a winding-up resolution passed on or after 6 April 2010, ° goes into voluntary liquidation immediately following an admumustration on or after 6 April 2010, except where the preceding administration began before that date, ° goes into compulsory liquidation as the result of a petition presented on or after 6 April 2010, except where the liquidation was preceded by - an administration which began before that date, - a voluntary liquidation in which the winding-up resolution was passed before that date 13 Summary of Charge Out Rates and Disbursement Charges with Effect from 6" April 2014 Rushtons Insolvency Limited Current Hourly Charge Out Rates Director 200-280 Manager 180 Support Staff 100 Time cost analysis & explanation of work undertaken with effect from 6 April 2014 Category Examples of Work Administration & Planning Case planning, reviewing, admunstrative set up, appointment notification, maintenance of statutory records, statutory reporting and compliance Realisation of Assets Identify, locating, realising and insuring Company assets Dealing with charged and past secured assets and verifying security documentation Trading Employee issues, instructing experts and agents, accounting, management operations Investigations Statutory duties, SIP 2 review, SIP 4 & CDDA reports, antecedent transactions and viable matters brought to our attention Creditors Communicating with creditors, (secured, preferential and unsecured) creditor claims, adjudication on claims, dealing with preferential creditors (employees) and dividends Reporting Reports and circulars to Creditors Case specific matters The nature of insolvency work means not every case 1s the same and may produce unique work requirements not covered above Rushtons Insolvency Limited — Disbursements recovery policy — SIP 9 Category _1 disbursements Bordereau/insurance Charged at cost Case advertising As per advertisers/agents invoice Courter Charged at cost DTI IVA registration fee Charged at cost (in relevant cases) Land Registry/Searches As per Land Registry, agents or Companies House invoice Post re-direction, Charged at cost Subsistence Charged at cost Category 2 disbursements Travel Charged at cost for public transport and taxis Mileage 1s recharged at 45p per mile Postage Communication costs based on a charge of £6 25 per cieditor/debtor/shareholder/employee/company officer Communication costs mcludes postage, photocopying/printing and fax Room Hire £100 room hire made available in-house for case specific meetings Charges only to be made when attendance of debtor/director and/or creditors 1s hkely and a meeting room has been set aside Whete appropriate, external room hire at cost (Category 1) Storage Document storage at a rate of £7 50 per box per year