Fixed share lawyers threaten action against ex-Halliwells partners
A GROUP of former fixed share members of collapsed Manchester law firm Halliwells have sent a letter to the firm’s former equity partners threatening legal action regarding their conduct in the run-up to the firm’s collapse.
The letter – sent on behalf of 14 former fixed-share Halliwells members – argues that the equity partners who shared a £24.5m “reverse premium” payout for signing the lease on its former 3 Hardman Square Manchester headquarters had not acted in good faith.
Chris Jones, a partner at Irwin Mitchell in Manchester representing the fixed share members, said: “We and they have (the fixed share members) spent a significant amount of time investigating the actions of the full members of the LLP in the period to the date of the administration order and those investigations are continuing.
“A considerable amount of information is being, and will continue to be, sought in this regard.
He said the aim of its investigation into the firm’s collapse was “to ascertain our clients’ position as regards the conduct of the full members prior to administration, given both the potential claims against our clients and the losses incurred by them as a result of the administration of the LLP.”
He added: “Our clients wish to reserve their position until these investigations have been completed.”
Both the former fixed share members and former equity partners are facing the prospect of legal action from administrators BDO for the recovery of drawings taken out of the firm in the run-up to its collapse. The claim could be worth up to £10m.
However, Legal Week has reported that former equity share partners are reported to have changed the firm’s deeds so that in the event of a collapse only the equity partners would be able to offset tax either owed or paid out on their earnings.
