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BLG and HBJ create firewall for liabilities of Halliwells arrivals

The successor practice is clearly the new LLP which has its own indemnity insurance and therefore satisfies the criteria of the SRA that clients are covered on a “claims made basis” by either a successor practice or run off indemnity insurance. I can see no scope in the definition of "successor practice" contained within 8.2 of MCT 2009 which would allow the SRA to "deem" HBJ to be the successor practice as they have not become the owner of Halliwells immediately following a transition and they have not put themselves out as so doing. They are merely a member of an LLP that has become the successor practice (and which has many other members in the shape of former Halliwells equity partners) In the event that the LLP is merged into HBJ, HBJ will of course become a successor practice to both the LLP and via the LLP, Halliwells, but this will be after a couple of years when HBJ are confident about the dangers involved in this. Don't forget the SRA have been physically present in Spinningfields since the first notice of intention to appoint was filed so they have given this a stamp of approval already and HBJ will have sought assurances from them that this approach would not be questioned before they committed to the deal. While this is maybe not be ideal it is better then the alternative, which would have seen no successor practice and an insolvent Halliwells unable to pay for run of insurance.

27-Jul-2010

0:06 am