Administrators handling the affairs of a collapsed law firm network say they have secured a ‘positive outcome’ after finding a buyer for parts of the business.

Stephen Katz and Paul Cooper, partners at Begbies Traynor, were appointed as administrators last week to Law Direct Limited, which had acted as an umbrella company for a number of businesses acquired since it was incorporated in 2011.

The company traded as law firms Blackstone Law Solicitors & Advocates, Ellison & Co, Strain Keville, Geoffrey Bryant & Co, Brinley Morris Rees & Jones, Redfern & Co, Beverly Davies Penny, Volks Hedleys, Kirk & Partners, Davies Ingram Harvey, Davies Phillips & Partners, Griffith Smith Conway, and Dakers.

In a statement, Begbies Traynor said that Law Direct had begun to experience financial difficulties over the last two years after making numerous acquisitions.

The statement continued: ‘For a number of reasons, the integration of the acquired businesses was not straightforward and became increasingly difficult over the period resulting in the company being unable to properly control the businesses and to renew professional indemnity insurances across the various practices when they were up for renewal.

‘Due to these complications, it became clear that an insolvency process was required and after discussion with the SRA it was determined that pre-packaged administration sale, where requisite marketing, bidding, negotiation and contract preparation was undertaken prior to the company entering administration, would ensure that part of the business could seamlessly transfer to a new operator ensuring that as many of the clients as possible could be protected and their respective files progressed without significant disruption.’

The sale of certain aspects of the business and assets was completed on 20 June to north west London firm Alexander and Partners. The administrators said this arrangement had secured three jobs and ensured the seamless transfer of files, although it is not clear what trading names are being retained or what is happening to the remaining staff.

The sale was followed by an intervention by the SRA into those parts of the practice which were not covered by the sale arrangements.

Katz said: ‘Despite the significant complications faced by Law Direct Limited after an extensive period of acquisitive growth, we are pleased to have secured a positive outcome and the safe progression of much of the ongoing client work that was currently being progressed by the firm.’

 

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