Liverpool firm SGI Legal bags first chunk of Challinors

SGI Legal has bought the personal injury files of failing Midlands firm Challinors, the Liverpool-based firm announced this afternoon, amid suggestions that other parts of the struggling practice would be off-loaded in the next few days.

The deal was cut for an undisclosed sum and involves all work in progress, including serious injury, employers liability and public liability claims. But no Challinors partners will transfer to SGI. 

The personal injury specialist firm – which was granted an alternative business structure (ABS) licence at the beginning of this month – said it will shift all the Challinors files to its Liverpool offices. 

Commenting on the purchase, managing partner Simon Gibson said: “Our structure and resources have enabled us to respond swiftly to the opportunity that arose due to Challinors’ difficult circumstances. We have been pleased to work with the firm’s partnership and the likely administrators to ensure a smooth transition for clients whose best interests will remain our top priority.” 

Meanwhile, the Challinors’ administrators told The Lawyer that further developments were anticipated soon. Andrew Hosking, national head of lender services at RSM Tenon, said he expected “a substantial disposal within the next 48 hours”. 

Challinors went into administration at the end of last month with reported debts of more than £11 million (24 July 2013). The move has triggered a barrage of criticism of the Solicitors Regulation Authority, which as not intervened in the practice on the grounds that it maintains there are no current risks to clients (5 August 2013). 

However, two ex-clients allege they are owed collectively as much as £650,000 in loans they made to the firm’s partnership (30 July 2013). One former client has issued a bankruptcy petition against Challinors’ senior partner, Paul Griffiths, with a hearing date understood to be scheduled for mid-September (15 August 2013). 

SGI Legal launched last year. It has nearly 60 staff, and only four partners, no of whom are fee-earning.