Metamorph firm's staff to miss out on £190,000 as creditors wait in limbo

Dozens of unpaid former staff at a Metamorph Group firm continue to wait for their money amid the fallout from the consolidator's implosion.

Meanwhile, staff at another firm collectively owed more than £190,000 are in line to receive nothing.

The Gazette understands that former employers of Bedfordshire firm Knowles Benning – one of several firms shut down by the Solicitors Regulation Authority either side of Christmas – are exploring all options for recovering the monies owed to them.

Despite the firm being intervened in by the SRA more than two months ago, the owners have not been able to formally liquidate the business, meaning it is extremely difficult for employees to claim redundancy. Instead, it is understood that most staff have begun the process of reclaiming money through the employment tribunals process, whilst some are trying to fund the winding up of Knowles Benning through the courts.

The number of people with the firm when it closed is unclear, partly because the business absorbed much of the work in progress and transferred staff from other firms in the Metamorph Group late last year.

One former employee told the Gazette that everyone made redundant by Metamorph in December is still owed salary from November and December, as well as redundancy payments, notice payments and pension contributions.

Meanwhile, another Metamorph business, Buckinghamshire firm Browns Solicitors, has been placed into liquidation. Documents filed with Companies House state that London firm Macintyre Hudson LLP was appointed as liquidator at the start of this month, meaning staff with Browns can in theory go about claiming redundancy money.

But a statement of affairs, signed off by the sole remaining director Simon Goldhill and prepared ahead of the liquidation, show that nothing may be available to the 17 employees.

According to the statement, the total assets available to cover £15,438 owed to preferential creditors (comprising employee arrears and holiday pay) is estimated at ‘nil’. The shortfall for unsecured non-preferential creditors is likely to be around £307,000. This includes £131,000 that will not be paid to trade and expense creditors and £176,000 that is due to the same 17 employees who are also listed in this category.

Browns, which was the last of the seven Metamorph firms to be intervened in by the SRA last month, operated from two offices, in Aylesbury and Wycombe. When it joined the Metamorph stable in March 2021, group executive chairman Tony Stockdale said the move marked another step on the path to making the group one of the country’s leading law firms.

Browns was yet to publish accounts that had been due by 30 June 2022 when it was shut down. The most recent accounts, for the year ended 31 December 2019, show the firm had net assets of £587,000 including £531,000 in cash. The firm had employed 37 at the time.

Two Metamorph businesses, Hampshire firm Beeton Edwards and Buckinghamshire firm Parrott & Coales, are still operating and are unaffected by the SRA action.

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