The High Court has approved further fees for the joint administrators of Quinn Insurance and their firm, Grant Thornton, for the next four months.
The fees for October to the end of January, likely to be at least €1.5 million, plus legal fees, will be paid from the assets of the company.
The administrators, Michael McAteer and Paul McCann, and Grant Thornton received some €1.5 million in fees for the three months of July, August and September, and had applied to the court to be paid fees calculated on a similar basis for the months of October, November, December 2010 and January 2011.
They also sought that fees for their lawyers, McCann Fitzgerald, for the four months to January 2011 should be calculated on a similar basis to fees already paid to the firm over the past months.
Some €290,000 in fees was sought by the solicitors for the three months of July, August and September last on the basis of rates ranging from €160 per hour for a trainee solicitor to €495 per hour for a senior partner.
The President of the High Court, Mr Justice Nicholas Kearns last week directed the joint administrators, who were appointed last March, to provide affidavits to the court to explain why their fees had not decreased significantly at this stage of the administration as he believed there was less work involved now.
In court today, Bernard Dunleavy, for the administrators, referred to affidavits by Mr McCann and from Jane Marshall, of McCann Fitzgerald, outlining the basis for the fees being charged. While hours of work for the administrators had reduced in some months in some respects, it was anticipated, as the sale process for Quinn intensified, it would take up more time, counsel said.
Mr Dunleavy also said the solicitors had provided they would apply a 5 per cent discount on fees charged once the fees reached a certain level and that discount had been applied.
Having read the affidavits and heard from counsel, Mr Justice Kearns said he would approve calculation of the fees as sought and also noted the fees had been subject to peer review.
The judge said the court had to be “vigilant” in monitoring the level of fees and expenses on an ongoing basis, particularly as the case was being relied on as a precedent in relation to fees in other cases although it was an exceptional case.
In his affidavit, Mr McCann said the administrators have a core staff comprising one director, two managers and one senior to deal with the day to day management issues of Quinn. One partner from Grant Thornton’s corporate finance team, along with the administrators, had overall responsibility for the co-ordination of the sales process relating to Quinn.
The administrators had also drawn on the sales expertise of other colleagues in Grant Thornton from time to time related to some issues.
Mr McCann said he expected workloads would increase in connection with the intensification of the sale process for the Quinn business.
According to material supplied to the court, the fees for the two administrators themselves totalled €726,329 for the three months of July, August, and September while professional fees charged by Grant Thornton Ireland Support and Grant Thornton UK Support, plus “outlay” of some € 48,876, amounted to a further €839,097, giving a total of €1.56 million.
Fees for McCann Fitzgerald were some €137,000 for the month of July, some €70,000 for August and some €90,000 for September.
In her affidavit, Jane Marshall, a partner in McCann Fitzgerald, said a case of the size and complexity of this administration requires the expertise of several different departments in the firm. She anticipated the administrators would continue to require regular advice over the coming months, particularly in relation to the complex and technical sale process for Quinn.
Last week, the administrators told the court they had given the findings of their investigation to the Financial Regulator Matthew Elderfield, who had placed the insurer into administration. No details of the investigation or findings were revealed to the court and the regulator will now decide what steps, if any, to take in light of the report.
