I’ll Be Back (To Apply For My Remuneration) - Court Terminates Receiver Application For Approval Of Remuneration For Future Work

In the recent case of Australian Securities & Investments Commission v A One Multi Services Pty Ltd (No 2)1, the Federal Court considered an application brought by Court appointed receivers seeking approval for their remuneration in respect of past and prospective or future work. 

Downes J approved the claim for remuneration for work already performed.  However, while Her Honour accepted that the Court has power to approve remuneration for prospective work, she declined to approve the claim in this case.

The decision provides a useful summary of the key considerations the Court will take into account when fixing remuneration generally and the matters the Court will take into account when an insolvency practitioner seeks provisional approval for remuneration for future work.


On 21 October 2021 the applicants were appointed by the Court as joint and several receivers and managers (Receivers) of the property (Property) of A One Multi Services Pty Ltd (A One), Aryn Hala (A One’s director and shareholder) and Heidi Walters (a shareholder and former director of A One) (collectively, Defendants), on the application of ASIC2

The appointment arose following an ASIC investigation into allegations that A One was operating an unlicensed financial services business, with Mr Hala and Ms Walters providing unlicensed financial advice to investors.  Investors were allegedly informed that they could receive annual investment returns in excess of 20% by transferring their superannuation into a self‑managed superannuation fund (SMSF), with the SMSF then lending its funds to A One for investment. 

ASIC’s preliminary investigations indicated that:

  • A One received at least $18.3 million from approximately 60 SMSFs and 92 investors;
  • apart from substantial sums ($6.3 million) being used to meet Mr Hala and Ms Walters’ personal expenses, at least $2.4 million of A One’s funds were spent at cryptocurrency exchanges; and
  • Mr Hala had acquired Bitcoin to a value of between $7 million to $22 million, with additional undisclosed funds in other cryptocurrency accounts.     

Given Mr Hala possessed the codes necessary to transfer all of the cryptocurrency under his control, and the apparent lack of returns to investors and SMSFs, the Court appointed the Receivers to identify, collect and preserve the Property of the Defendants, investigate the receipt and application of investor funds, and pursue recovery of those funds if required.

Approximately 9 months after their appointment, the Receivers applied to the Court for approval of, among other things:

  • their remuneration for work already performed; and
  • 85% of their projected future remuneration on an interim basis, which could be drawn each month until the end of their appointment but subject to:
    • the Receivers seeking retrospective approval from the Court, prior to the end of the appointment, of all amounts so paid (while also reserving the right to seek approval for payment of additional amounts); and
    • the Receivers repaying that part of any payment made to the extent that the Court refused to give retrospective approval.

Court’s power to fix remuneration

The governing principle for the Court when exercising its power to approve remuneration is that it should only allow such remuneration as is fair and reasonable.  In determining what is fair and reasonable, the same general principles apply to remuneration sought by Court appointed receivers as to other external administrators3, including the matters referred to in section 425(8) of the Corporations Act 2001 (Cth) in respect of privately appointed receivers, and the proportionality of the remuneration sought having regard to the work done and remuneration claimed compared to the value of the estate.

Importantly, the power extends to approving prospective remuneration for work the receivers anticipate will be required during the receivership.  In particular, the Court may approve prospective remuneration where4:

  • it is satisfied that work already performed by the receiver in the receivership was undertaken in a reasonable and proper manner (a rare example of  past performance being taken as an indicator of future performance);
  • the receiver:
    • identifies the tasks to be undertaken with reasonable specificity;
    • provides estimates of the likely cost of each of the anticipated tasks;
    • specifies the likely duration of the receivership;
    • identifies the assets which have been and are likely to be recovered, as well as their value, so that the Court is assured that the assets will not be unreasonably depleted by payments to the receivers;
  • the prospective remuneration is capped;
  • the orders include a mechanism both for:
    • review of the remuneration drawn, either periodically or at the conclusion of the receivership; and
    • the receiver to repay any remuneration drawn which, upon review, is found not to be fair and reasonable;
  • the risk that the receiver will not be able to repay any overdrawn remuneration is low; and
  • the nature and magnitude of the receivership is such that it would be unrealistic to expect the receiver to have to wait to be remunerated for months at a time.


In this case, Downes J was satisfied on the evidence that the work performed by the Receivers had been undertaken in a reasonable and proper manner and that the amount claimed for that work was a fair and reasonable amount.  Accordingly, her Honour approved the remuneration sought in respect of work already performed, despite the opposition of the Defendants.

However, Her Honour was not prepared to make an order allowing the Receivers to draw interim prospective remuneration as proposed or at all. 

In terms of the factors listed above:

  • given Downes J approved the Receivers’ remuneration for work already performed, it appears that Her Honour was satisfied that the Receivers’ past work had been undertaken in a reasonable and proper manner;
  • the proposed orders included the necessary mechanisms for review and repayment;
  • however, the Judge was not satisfied on the evidence that the prospective remuneration could be determined with sufficient specificity.  In that regard, the Receivers provided evidence about the tasks they expected would need to be undertaken.  However, the evidence was qualified due to the limited information then available to the Receivers.  That meant that:
    • there was insufficient certainty about the tasks that would need to be undertaken;
    • the Receivers were not in a position to provide estimates of the likely cost of the anticipated tasks;
    • the likely duration of the receivership was unclear; and
    • consequently, Downes J was concerned that there was a real risk of depletion of the property; and
  • there was no proposed cap on the prospective remuneration (other than allowing the Receivers to only draw up to 85% of their interim remuneration per month).

In declining the orders for prospective remuneration, Downes J also gave weight to the fact that ASIC opposed the order, as well as ASIC’s submission that it was not appropriate for the Receivers to draw their remuneration in advance from property that may ultimately be held in trust for the benefit of the investors and SMSFs.

The Receivers argued that interim approval of prospective remuneration would minimise the time and expense of multiple approval applications.  However, her Honour noted that at least one more application would be required in any event and overall, the potential efficiencies did not outweigh the Court’s concerns noted above.

Lavan comment

This case provides a useful summary of the general principles for Court approval of receiver remuneration whether it is sought in respect of past or future work, and the factors that the Court will take into account.

If you have any questions about the remuneration of receivers or any other form of external administrator or controller, the experienced Lavan team is here to help.

Disclaimer – the information contained in this publication does not constitute legal advice and should not be relied upon as such. You should seek legal advice in relation to any particular matter you may have before relying or acting on this information. The Lavan team are here to assist.
Shelley Gepp
Special Counsel
Lawrence Lee
Restructuring & Insolvency


[1] Australian Securities & Investments Commission v A One Multi Services Pty Ltd (No 2) [2022] FCA 1100.

[2] Australian Securities & Investments Commission v A One Multi Services Pty Ltd [2021] FCA 1297.

[3] At [16]-[23].

[4] At [26].