In the recent English decision of Neumans LLP v Andronikou & Others, a company had unsuccessfully opposed a winding up petition and the question for the Court was whether the solicitors' costs in doing so were an expense of the administration. In considering this issue, the Court noted that there would have to be "some special reason, connected with the administration" to make the administrators pay fees in full as an expense when statutory provisions did not allow for solicitors to have priority over other creditors and those entitled to claim expenses. In the present case there was no such special reason. It could not be said that payment of the solicitors' fees would be necessary or incidental to the performance of the administrators' functions.

While the company incurred the costs by contracting to pay fees to the solicitor before the presentation of the winding up petition, where the payment to the solicitors would not in any way benefit the administration process there was no reason why the payment of such fees should be given priority over other creditors. The Court considered that where there was one type of insolvency process followed by another type of insolvency process, it did not follow that an expense in one should also be an expense in the other.

See Court decision here.