BDO demands return of cash from ex-Halliwells partners

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  • so the Tuscan palazzo, the Cumbrian lakeside retreat, the Spanish pool and the Aberdonian castle are up for sale are they?

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  • I don't see why they should pay it back, or why they should have left the cash in the business. It's their business, and that business received a serious amount of cash it did not need at the time, so they extracted it, as they were entitled to do as the owners of the business. Unless it was illegal to extract the cash as they did (similar to restrictions on dividends only being payable out of distributable reserves at the time) the administrators will struggle because of limited liability and the limited scope of the clawback provisions in the insolvency act.

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  • Paul Thomas joined Gately Wearing as a consultant but left when he found out that his fellow partners had all resigned from Halliwells LLP leaving him to carry the can on the St James's Court lease. Classy move by the former Halliwells partners. Tax advice anyone?

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  • The £20.4M was not distributed amongst its equity partners. The Fixed Share Members had one twentieth of a point which means they were also equity partners albeit on the same basis as somebody holding a few shares in a PLC. Do you lose your right to dividends, your right to notice of meetings and your right to vote if you only hold a handful of shares? Of course you don't but the Halliwells FSM's were not even told about the deal with the Landlord and certainly didn't receive a few measely grand despite the fact that they held equity. Giving up the .4M would have hurt the full members too much so they decided to try and keep it a secret.
    Bet the FSM's are glad they didn't get any of it.

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  • If these circunstances were posed as part of examination question they would be considered fanciful and unbelievable. The real sadness is the firms who took on the ex-Halliwells partners. Was any digging done at all or were the hard questions simply not asked.

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  • No doubt the new firms will arrange loans to these characters to repay the money, or pass the hat round? They won't want the embarrassment of this.

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  • Ashley Balls | 21-Jun-2011 0:26 am
    If these circunstances were posed as part of examination question they would be considered fanciful and unbelievable. The real sadness is the firms who took on the ex-Halliwells partners. Was any digging done at all or were the hard questions simply not asked.
    I suspect that the other firms were only interested at the time in how many files and clients they were acquiring. In any event, the partners would probably have denied all knowledge of what had gone. In many cases it would have been correct.

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  • Interested Observer - None of the partners who went to BLG or Hill Dicks participated in the Spinningfields payout.
    One of the main reasons the partnership split into different practices was that the partners who didn't participate in that awful transaction (and didn't know about it) could no longer be in partnership with their ex-colleagues once their duty to the LLP, clients and their staff had been carried out.
    I'm sure a number of very good partners who are untainted by this transaction could have bailed (like many others both Spinningfields and Non-Spinningfields did) but their sense of right and wrong was clearly better tuned than others.
    In answer to another question posted, the leaving spinningfields partners went to different firms, Fladgate, DWF, Kennedys, Pinsents etc etc.

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  • in response to Ashley Balls
    BLG have got a good department out of it, it fits into their existing service provision and will perform well if Kevin focuses and Damian delivers.
    HD are dominant in the North West and will develop more strength on the back of the purchase of Halliwells Liverpool and bits of Halliwells Sheffield. There is history and friendship between the key Partners involved. It will work.
    The HBJGW deal was a joke. No "due diligence" was done. It was the tragic consequences of greed (Dudley) and desperation (Manchester). Anyone with any sense wouldn't have agreed to it . But don't underestimate the Partners in Manchester. Austin, Thomas and Craig aside, there is a lot of good hardworking partners there.

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  • Does anyone actually have specific details of the basis of the claim though? I agree the 5.50pm 20 June comment : how was this payout not legitimate? It was their business that had cash. Why can't they pay it out? They have have breached duty to the FSMs but it isn't the FSM making the claim as far as we can tell......

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