Clarke Willmott and Cartwright King have acquired teams from Midlands-based Challinors as administrators dispose of the firm’s remaining files.
Clarke Willmott has picked up 10 members of staff from Challinors’ private client and commercial litigation teams for its Birmingham office with immediate effect.
Meanwhile fellow Midlands firm Cartwright King said eight members of staff, mainly from Challinors’ family team focusing on childcare law, had joined, bringing all of their cases. The team includes five solicitors and two paralegals.
A source at RSM Tenon confirmed to The Lawyer that all the Birmingham practice’s active files had been sold, but did not provide names of the purchasers or details of the amount paid.
The administrators also indicated there would be some redundancies at Challinors, but did not specify how many or whether any of the firm’s 14 partners would be moving to other practices.
The development follows the sale earlier this week of all Challinors’ personal injury files to Liverpool-based alternative business structure SGI Legal (20 August 2013). The deal was cut for an undisclosed sum and involved all work in progress, including serious injury, employers’ liability and public liability claims. No Challinors partners have transferred to SGI.
The personal injury specialist firm – which was granted an ABS licence at the beginning of this month – said it would shift all the Challinors files to its Liverpool offices.
Five-office Challinors unravelled under the weight of more than £11 million in debt to unsecured creditors, allegedly including former clients, and announced last month that it was going into administration (24 July 2013). It is understood that the 40-lawyer firm owes about £4m to its bank, the Allied Irish, and £500,000 to HM Customs and Revenue.
The firm’s financial trauma – and its alleged additional £650,000 debt to two ex-clients – has thrown a spotlight on the Solicitors Regulation Authority, as calls mounted for it to intervene in the practice, notably after one debtor issued bankruptcy proceedings against the firm’s senior partner (15 August 2013). However, the regulator steadfastly maintained that clients were not at risk during the Challinors administration and that there was no need for direct action.