Hammonds is preparing to sue a group of 12 former partners in the next stage of an increasingly bitter dispute over the distribution of firm profits.
Hammonds has rejected a settlement by the group and managing partner Peter Crossley told The Lawyer that litigation is now “inevitable”.
Crossley said: “A proposal was made to us that was not acceptable. We want them to pay back what they owe to us and to be placed in the same position as any other partner that stayed with us.”
As reported by The Lawyer (3 April 2006), Hammonds wrote to the group at the end of March 2006 and laid down a deadline of 30 April 2006 for agreeing to begin repayment of overdrawings from the 2004-05 financial year.
The firm asked partners for a total of £3m that was drawn during the 2004-05 financial year, in addition to repayments for 2003-04. The firm proposed a five-year repayment plan for the 2003-04 money.
Hammonds head of commercial and dispute resolution Lucci Damone is the partner in charge of pursuing the money.
The ex-partner group is represented by Addleshaw Goddard partnership expert Richard Linsell.
Hammonds is also pursuing money from a group of at least five other partners, who left the firm prior to the partnership agreeing to restate its profit in July 2005 (The Lawyer, 25 July 2005). Herbert Smith has written to this group on behalf of Hammonds.
Hammonds is also pursuing a number of partners that left the firm after agreeing to the restatement. The firm made £8.1m less in 2004 than it had reported originally.