In Focus: Axiom Ince soldiers on after shock interventions

Uncertainty reigns over the future of an aggressively acquisitive law firm which has lost key personnel under a cloud and where talks have taken place about breaking up the business.

Six weeks ago Axiom Ince was basking in the role of saviour, after buying national insurance firm Plexus Law. This was Axiom’s second such rescue deal this year, following its acquisition of the remains of the Ince Group from administration.

Yet there is no cause for celebration this week, with three directors suspended by the Solicitors Regulation Authority, staff fearing for their futures, overnight office moves, and accountants drafted in to investigate what has gone wrong.

Last month Axiom Ince conceded in a statement that it would ‘likely be unable to continue in its current format’. A halt was placed on accepting any new instructions, although the firm said it was able to continue to trade as normal. ‘This may mean that parts of the firm and teams within the firm may be transferred to different practices to provide continuity of service to clients,’ said the firm.

Days previously, the firm revealed it had brought in accountancy practice BDO to conduct what it called a ‘thorough and comprehensive investigation and review’ of what had caused the SRA to take action against three directors.

Pragnesh Modhwadia, Idnan Liaqat and Shyam Mistry were each effectively barred from practising after an intervention from the SRA on 10 August.

Pragnesh Modhwadia was the managing partner of Axiom DWFM, based in Wigmore Street, London, and founded its predecessor firm Axiom Stone Solicitors. He was subject to intervention on the basis of suspected dishonesty and a failure to comply with Solicitors Act rules.

Court files show that Axiom Ince Ltd has brought a claim for breach of fiduciary duty against Modhwadia. The firm is represented by Devonshires Solicitors and the claim was filed on Tuesday. It is also understood that the High Court has granted a freezing order preventing him from accessing funds held by him.

When the interventions were first confirmed by the SRA, a statement from Axiom Ince said the action was a result of ‘the misappropriation by Pragnesh of very significant sums of money’. A lawyer claiming to be a representative of Modhwadia said the SRA’s investigation was at an early stage and asked that ‘premature conclusions’ not be drawn.

Shyam Mistry, who was head of personal injury and medical negligence, and Idnan Liaqat, who was head of commercial, investment and residential property, were both subject to interventions on the grounds of suspected breaches of solicitor rules.

The interventions may be challenged. It is understood that Pragnesh Modhwadia contests the SRA’s claims but has not made any statement yet about whether he will challenge the intervention in the High Court. Shyam Mistry has reportedly already lodged an application with the court and has invited the SRA to withdraw its intervention. Idnan Liaqat’s position is unclear.

Axiom’s purchase of both Ince and Plexus Law means it is now a business with several hundred employees. (It has no connection with lawyers-on-demand service Axiom Law.) The Plexus deal alone saw 540 people transferred to the Axiom Ince banner. Axiom DWFM was a full-service practice created through a merger between Axiom Stone and DWFM Beckman. It had several offices in London and bases in Birmingham, Bristol and Swindon, and had recently announced the acquisition and merger of Wiseman Lee, which was intended to increase the firm’s footprint in the capital.

As recently as April, when the Ince deal was completed, Pragnesh Modhwadia appeared to be a key figure in the group’s expansion plans, speaking about his excitement at taking on the maritime specialist and building the firm’s market position. ‘When the opportunity came to acquire a business of the calibre of Ince & Co we were eager to engage and are delighted that the Ince & Co team shared our enthusiasm,’ he said at the time.

In a sign of how fast the situation is progressing, the Gazette understands that Axiom directors announced, with just a few days’ notice, that staff would move out of London’s Aldgate Tower office over the August Bank Holiday, relocating en masse to the Plexus office in Gracechurch Street. Staff who were on holiday and could not get back to their old base before the move were asked to make alternative arrangements to pick up their belongings.

Employees have contacted the Gazette to express concerns about whether they will have to pay back salaries if the funds were found to have been secured inappropriately. A spokesperson for the firm said the wellbeing of employees was important and that it was working to secure the payment of salaries as normal for the August run (in the event there were no reports of unpaid salaries).

Yet all remains in flux. The public relations company that relayed those reassurances in mid-August was no longer working with Axiom Ince by this week.