BDO partners acting as liquidators for Halliwells were yesterday refused leave to appeal a High Court judgment that prevented them from chasing one of the failed firm’s former partners for cash.
Lawyers for Halliwells’ liquidators, BDO partners Shay Bannon and Dermot Power, were in the Chancery Division of the High Court seeking leave to appeal a summary judgment given by Mr Justice Warren in the same court in April (24 April 2012).
At the hearing in April, Warren J held that former junior equity partner Michael Burns’ retirement deed from Halliwells, which stipulated a clean break, was valid and meant that he could not be pursued by liquidators for cash owed to the firm.
Representing Bannon and Power Lexa Hilliard QC of 11 Stone Buildings yesterday argued that Warren J had got the law wrong and that it was a point of public interest to appeal the case. Warren J, however, denied them leave to appeal and ordered indemnity costs of around £30,000 against them. BDO now has 21 days from the date of judgment to decide whether to go direct to the Court of Appeal with its case.
“Indemnity costs are exceptionally rare these days,” said Burns’ lawyer, Irwin Mitchell partner John Lord. “They’re only really made in circumstances where the court takes a dim view of certain conduct.
“[…] We were disappointed by the liquidator’s decision to further deplete realisations by seeking to appeal the very comprehensive judgment of Mr Justice Warren. We shall continue to defend all of our clients against the claims intimated by the liquidators and we’d hope that the significant cost incurred by the liquidators in this case will lead BDO to review their litigation strategy and not appeal this decision further.”
Irwin Mitchell partner Chris Jones is acting for 14 former Halliwells fixed-share partners on litigation stemming from the firm’s collapse (17 October 2011).
Lord instructed James Potts of Erskine Chamber to represent Burns, who is now a partner at DLA Piper, in court.
Hilliard was instructed by Addleshaw Goddard partner Alison Goldthorp for Bannon and Power.
BDO declined to comment.