The largest creditors of failed law firm Halliwells have formed a committee in what could be a precedent to further legal action against the firm’s former partners.
The biggest sum is owed to the firm’s former bank RBS, with which it has £18m debts. As RBS holds a debenture over the LLP’s assets, it is first in line to recover the £10m from the sale of the business.
However, it has been joined by other unsecured creditors on the committee: HM Revenue & Customs, which is owed £4.3m; a German fund run by Credit Suisse Asset Management, the landlord of the firm’s former headquarters at Spinningfields, which is owed £2.4m; ING Lease UK; and the landlord of Halliwells’ Liverpool office, Bruntwood 2000 Beta Portfolio.
“In the end, legal action depends on funding,” said Ben Larkin, insolvency partner at Berwin Leighton Paisner, who is not involved with the matter. “Will the creditors put their hands in their pockets, or will there be such a strong case as to get barristers and lawyers to take it on a CFA [conditional fee arrangement] basis?”
As reported by The Lawyer (15 November), four ex-Halliwells partners are facing legal action from the landlord over unpaid rent at the firm’s former HQ.