A call for an inquiry into the conduct of a company's taxpayer-funded liquidation has been rejected by the High Court.

Montpelier (Trust and Corporate) Services Ltd (MTCSL) has been the subject of a long-running, complex and costly liquidation dating back to 2020.

Last year, the liquidators presented bankruptcy petitions against the trust services firm's managing director and beneficial owner, Edward Watkin Gittins, and his wife, Maura.

The petitions were due to be heard on October 30. However, the court instead heard an application by Mr Gittins seeking an inquiry into the conduct of the joint liquidators and the receiver and manager of MTCSL, including whether the liquidators should be removed from office.

The liquidators argued the application was an attempt by Mr Gittins to delay and obstruct the bankruptcy proceedings.

MTCSL was wound up by the High Court in the public interest in 2020 after a receiver and manager had been appointed the previous year.

The Financial Services Authority had accused Montpelier of diverting millions of pounds of client money.

The court heard the receiver's fees and expenses stood at £9.94 million at the end of January, with any shortfall not recoverable from MTCSL's assets being met by Treasury.

Meanwhile, the joint liquidators' costs were said to total £4.75 million, paid by the Financial Services Authority.

The scale of the costs formed part of Mr Gittins' argument that the court should investigate the conduct of those overseeing the liquidation, although the Deemster ultimately rejected that application.

In his judgment, Deemster Andrew Corlett concluded the claims lacked substance and said Mr Gittins could not credibly claim to be acting in the public interest.

‘It is noteworthy that no public interest concerns have been raised about the conduct of the receivership or the liquidation which is being funded by the Manx taxpayer,’ he said.

Representing himself, Mr Gittins argued the joint liquidators had failed to discharge their fiduciary and statutory duties to the expected high standard.

His complaint centred on their dealings with subsidiary Emmetview Properties Overseas Ltd and its wholly owned subsidiary, Kirkhouse Ltd, which had assets valued at between £3.7 million and £9.9 million.

Mr Gittins argued that by accepting appointment as joint provisional liquidators of Emmetview in August last year, the MTCSL liquidators had failed to recognise and avoid a conflict of interest.

However, the court found there was no evidence of any significant fall in Emmetview's value.

Deemster Corlett said it was common practice, and a ‘practical desirability’, for the liquidator of a holding company also to be appointed liquidator of its subsidiary.

‘There is no suggestion that any detriment has arisen,’ he said.

Mr Gittins said he intends to appeal the judgment and will continue to press for a public inquiry.

He also maintains the liquidation has cost taxpayers around £19 million, claiming the joint liquidators' fees exceed £9 million rather than the £4.75 million stated in the judgment, in addition to the receiver's £9.94 million fees.