Mixing it up: Alternative remuneration structures

14/10/2025

Beyond time-costing, this article explores alternative remuneration structures, embracing fixed-fee, percentage, and success fees. Drawing on Bruce Pasetti's insights from the 2025 ARITA Small Practice Conference, it guides practitioners on aligning with creditor expectations, navigating IPS Section 60-20 for disbursements, and ensuring meticulous record-keeping for care, preservation, and realisation fees. Effective communication is emphasised for successful court approval.

While sometimes a dry topic, remuneration is vitally important for insolvency practitioners. Though time-costing has long been the entrenched standard, the legal landscape and practical realities increasingly demand a more flexible and strategic approach. This article delves into alternative remuneration structures, drawing on recent case law, legislative provisions, and crucial insights into navigating court applications and stakeholder expectations. The discussion will explore how to move beyond a singular focus on hourly rates, embrace innovation, and ensure efforts are appropriately recognised.

The Evolving Landscape: Beyond Time-Costing to Value-Based Remuneration

The fundamental principle governing remuneration is clear: the onus is on the liquidator to establish the remuneration claimed is reasonable and proportionate. The court will bring an independent mind to bear on the matter, judging reasonableness and proportionality by reference to Section 60 of the Insolvency Practice Schedule (IPS) or, for older administrations, Section 473 of the Corporations Act. These sections, while distinct in application dates, share largely similar principles.

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