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Halliwells’ ex-managing partner: ‘I gave my life to that practice’

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  • The court may have sanctioned the preference but it did not expressly relieve the partners in Halliwells LLP from their duty to act with utmost good faith to each other. I imagine the retiring partners who had not yet been repaid their capital will be considering whether the failure to invite them to join one of the rescue deals amounted to a breach of that duty....

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  • Lots of people have commented on the partners' duty of good faith to their fellow partners. But Halliwells LLP was of course an LLP. Unless there was a specific provision in the members agreement setting out a duty of good faith to fellow partners, the only duty of faith the partners was owed was to the LLP, not their partners.

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  • Given that Austin states the December 2009 Kennedy's move was “the straw that broke the camel’s back” how can he justify trading/incurring debts after that date? If I was HMRC I would be taking a very long, hard look at the issue of personal liability.

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  • I understand that there was a duty to act with utmost good faith in the Halliwells partnership deed...

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  • The straw that broke the camel's back was the Spinningfields property deal. In other places and for other reasons, the administrators appear happy to admit to that. Not only did it ensure that the firm had an expensive property and substantial debt as the corporate and property markets crashed, but management's greed in ensuring that the monies from Spinningfield were neither retained nor shared equitably amongst all partners holding equity (however small) created a deliberately hidden timebomb which (when made public), destroyed the partnership.
    When a partnership elides its voting structure with its equity, and is run by the "commercial and entrepreneurial" amongst us holding a significant chunk of equity, then there can be little surprise when it decides against protecting its future in favour of topping up senior partners' pension funds.

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  • and still we keep asking ourselves about that Louis Vuitton luggage set and the managing partners' expense account

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  • Now it is being reported that Paul Thomas, litigation partner and one of the few partners who did not resign from the insolvent LLP (unlike Mr Austin), has written to the other (ex-) partners chasing an indemnity for the rent guarantee that he had to give, and stating that "the most natural and obvious explanation of your actions is that the scheme has been deliberately kept secret from me, to enable you and the other members to secure a purported advantage in disputing your liability to me under the indemnity. Such conduct is, on the face of it, misconduct, and requires investigation."
    It will be interesting to see what the Law Society makes of all this, let alone the new employers of said partners.

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  • Dear Scep Tick
    What makes you think that the information about the resignations, reasons for them or, indeed the Paul Thomas problem (and any advice received on how to deal with it), made it round to all but the Manchester Equity Partners of Halliwells?
    And before you feel too sorry for Paul Thomas, he has profited very handsomely from Spinningfields and other wheezes connected with Halliwells and its clients. As a former managing partner he, and others, were responsible for setting the tone.
    For those of us who had the misfortune to have anything to do with this firm, this behaviour does not surprise.
    Halliwells FSM

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  • Oh, don't worry, I'm not sympathetic. Just intrigued as to how far the backstabbing has gone. Professional integrity is surely in issue and something for the SRA to investigate.

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  • Anybody who worked there will recall the "One Halliwells" ideology. Austin would cite it on a regular basis. It dealt with a number of things including conduct and integrity. So many contradictions but the one defining feature was the collective greed of the equity partners. They are no doubt ripping in to each other although Paul's "poor me" email is highly amusing

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  • Many partners have now received a directors disqualification questionnaire asking them to confirm why the firm failed, what financial information was provided to the partners and whether any of the LLP's property or assets were transferred or disposed of. I doubt Mr Austin is going to get an easy ride!
    Any news on the Salford issue?

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  • It's astounding that we are at least a month on, millions have disappeared and the authorities have done nothing, but if commoners like me get into debt for a few hundred pounds the armies of debt collectors are on our backs immediately. It's one law for lawyers and one for non-lawyers. Why on earth is Salford still associating themselves with a business failure - are they stupid?

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  • So much fun filling in the form - how I smiled wryly when I got to the question about whether we were ever provided with management accounts. The real ones? The ones provided for Full Members or the ones provided for FSMs? And the question about services/goods supplied for value - could any fiduciary ever have justified the 3-year deal with 24/7? And the one about whether we ever had a full meeting of the partners - er "no"? And whether we were ever given a copy of all the resolutions passed and the amendments to the LLP deed - er that'll be a "no" too.

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  • For those reading who have to fill in this questionnaire - let them have it!
    As for Salford - no movement at all. The University are refusing to comment and no statements have been issued.
    There hasn't been a meeting of the Board of Trustees there since all of this came out. There is one at the beginning of October, however - I expect there'll be a few questions for Austin.

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  • Projections, projections, projections were the real strength of Ian Austin. Remember all those who put their money in based on projections of 30k per point? Did Ian really believe that the firm would achieve profits which would justify such projecions when he knew how badly exposed the firm was to the downturn, the extent of the creditors and the ongoing leasehold liabilities?
    As for the accounts produced, I would hope that the Administrator looks very carefully at what was produced and to whom.
    As for the Form, those who know what really went on and how the firm was managed are going to have an awful lot to tell the Administrator!

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  • BLG have been reported as spending £1M on the fit-out of the new offices for the ex-Halliwells insurance group of circa 250 people.
    How did Halliwells mange to spend £18M on the fit-out at Spinningfields for circa 900 people?

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  • Anonymous | 29-Sep-2010 12:43 pm
    Shurely any question about "How did Austin et al manage to spend [x]" is rhetorical?

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  • Re Anonymous 27 September @ 10:59, it's not a case of one law for lawyers and one for non-lawyers, it is a case of one law for the workers and one for the capitalists. "The bourgeoisie has stripped of its halo every occupation hitherto honored and looked up to with reverent awe. It has converted the physician, the lawyer, the priest, the poet, and the man of science into its paid wage-laborers."

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  • What was the cause of the failure of the business? Only 2 inches of space to provide a response which could run to a 20,000 word dissertation on how not to run a business. Ian Austin ought to work off the debt Halliwells owe to the CoL by presenting seminars on the subject of business failure.
    All budding lawyers could do with some guidance from one of the architects of the largest LLP failure the country has ever seen.

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  • Halliwells Jumble Sale

    I want to thank Ian, Alec and the others as I have bought some rather nice furniture at a very keen price. I suppose the difference is that I will pay for it.

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