Examiner’s fees at centre of legal dispute related to Sammon closure

An Irish building group wound up as a result of the collapse of the UK construction giant Carillion plc is at the centre of a High Court dispute over €294,000 in professional fees and costs sought by an examiner appointed to try and save the business.

Michael McAteer of Grant Thornton was appointed examiner in 2018 of the Sammon group which was involved in building five schools and an institute of education here around the time of the Carillion collapse.

Micheál Sammon Woodcraft Limited and Sammon Construction Ireland Limited were the two companies in the group whose parent was the Sammon Contracting Group Ltd.

When Carillion went into liquidation in January 2018, it owed Sammon companies €8 million, which it could not pay.

Mr McAteer worked on a survival scheme for Sammon during the statutory 100 day period after the High Court granted it protection against its creditors.

During this time, Randelswood Holdings, which is associated with the McGrath Group of property developers, expressed interest in investing €2.1 million to ensure Sammon's survival. Randelswood provided funding during this time totaling €630,000.

When contracts for Sammon were not continued, the court removed protection on June 5th 2018, and ordered the winding up of two of the Sammon companies. By the end of June, the third was also wound up.

Mr McAteer then asked the court to approve costs and fees for work on the examinership. Randelswood, as a creditor and notice party, objected saying its debts should be paid on an equal footing with the examiner’s bill.

It also asked whether the examiner’s costs were necessary and whether the examinership should have ended sooner as it should have been apparent by early May 2018, survival was not possible.

Mr McAteer argued the level of fees was reasonable, the work on the survival efforts was necessary and he had provided as much detail as he can about the examinership work.

On Monday, in a judgment delivered electronically, Mr Justice Senan Allen said the combined claim for remuneration and costs of the examinership came to €294,872.97. Nearly 700 hours work was claimed at hourly rates of between €84 and €357 depending on rates for seniors and juniors working for the examiner.

The judge was satisfied criticism of Mr McAteer as to the duration of the examinership was without foundation. Randelswood’s complaint about an unnecessarily long examinership had not been made out, he said.

However, the onus was squarely upon the examiner to justify his claim by reference to the extent, nature, complexity of work done.

The judge did not believe the information which has been put before the court is sufficient.

However, he was allowing Mr McAteer an opportunity to put further evidence before the court if he wishes.

This can be done by lawyers for Mr McAteer emailing the court registrar after which Randelswood could reply, he said.