Ex-Halliwells fixed share partners mull legal action against equity partners
A group of former fixed share partners in failed firm Halliwells are investigating decisions made by equity partners in the run up to the collapse of the firm with a view to taking legal action against them.
Irwin Mitchell partner Chris Jones is representing 14 fixed share partners in relation to litigation spiralling out of the firm’s demise (15 August 2011).
A statement released by the firm today on behalf of the 14 lawyers said they had spent “a significant amount of time investigating the actions of the full members of the LLP in the period to the date of the administration order and those investigations are continuing. A considerable amount of information is being, and will continue to be, sought in this regard”.
It continued: “The aim of the investigation is to ascertain our clients’ position as regards the conduct of the full members prior to administration given both the potential claims against our clients and the losses incurred by them as a result of the administration of the LLP.
“Our clients wish to reserve their position until these investigations have been completed.”
The partners are facing legal action from the firm’s administrators at BDO Dermot Power and Shay Bannon, who have instructed Addleshaw Goddard to recover drawings paid out in the run up to the firm’s collapse, as well as tax payments made on behalf of partners by the firm.
Claims against former Halliwells partners are understood to total £10m, ranging from between £10,000 and £200,000 per partner.
In June BDO launched a claim in the High Court against 32 former Halliwells partners including former chairman Ian Austin who shared between them the majority (£20.4m) of a £24.5m reverse premium payment from the firm’s Spinningfields landlord (20 June 2011).
The parties have since agreed to mediate the dispute in the new year (1 September 2011).
Readers' comments (5)
Ashley Balls | 18-Oct-2011 5:46 am
It is disappointing that it is likely to take litigation to learn of the full competencies and management skill, or otherwise, of the 'full' partners in this debacle. If it goes badly for the equity partners it will be interesting to see the reaction of the firms they moved to. More head in the sand no doubt...
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Ct | 18-Oct-2011 10:26 am
Maybe they will wake up to the fact that they have "bought" some pretty disgusting characters who think nothing of shafting their fellow partners.
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Disgusted | 18-Oct-2011 11:17 am
To Ct: I wonder what else these characters have been up to?
I'm not sure you can really blame the purchasing firms.
You do have to feel sorry for the many good people still working with these characters (as well as those made redundant when the firm collapsed), this is such a dreadful mess, it's hard to see a clean resolution to this.
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Truth will always out | 19-Oct-2011 7:56 am
The equity partner fools never learn.
They sneaked through an amendment to the llp deed so they could take the Spinningfields cash and then they sneaked another amendment through so they could get the terminal loss relief - another windfall for the greedy fools who wrecked the firm.
Wouldn't you have thought that they would have told the FSMs, the administrators and more importantly the court about what they had done. Securing a preference on the back of a bankruptcy threat when the shenanigans with the deed meant there would be a massive windfall for the equity partners really ought to have been put before the court.
Time for the court to re-examine the preferences and perhaps a reminder of the duties solicitors have as officers of the court.
Re-open the proceedings so that the creditors get a fairer deal and those responsible for the demise of the firm take their medicine.
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Anonymous | 21-Nov-2011 10:31 am
Let them have it Chris.....
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