Re MK Airlines (16 May 2012) (unreported)

MK Airlines went into liquidation on 22 June 2010. The liquidators company’s assets included leasehold premises which were used for storage purposes. By 20 September 2010, the liquidators had decided to retain the premises in order to sell the company’s assets. The liquidators accepted that the September quarter’s rent should be paid as an expense of the liquidation. However, they disputed liability for the June quarter’s rent on the basis that the June quarter day had occurred just two days after their appointment when they had not reached a decision on whether to use the premises for the purposes of the liquidation.

The court agreed with the liquidators. Merely retaining and securing the property whilst deciding what to do with it did not count as “use” sufficient to require the rent to be paid as an expense of the liquidation.