Another significant presence in the claims sector has disappeared with the second collapse in the space of a week.

Employees of Pure Legal, based in Liverpool, posted on Twitter and LinkedIn on Tuesday that the firm has gone into administration and that they were seeking work. The announcement was said to be made to staff on Tuesday lunchtime, with hundreds of redundancies made across the board.

In a statement posted today on its website, the company confirmed that Pure Business Group Limited, Pure Legal Limited and seven other entities were placed into administration yesterday by order of the High Court. In the same order, Robert Armstrong, Michael Lennon and James Saunders of Kroll Advisory Ltd were appointed joint administrators.

The statement added: 'The companies ceased to trade following the appointment of the joint Aadministrators. The joint administrators are currently undertaking their statutory duties following the appointment and working with industry regulators in relation to the protection of claimant rights. Immediately upon their appointment, and with the support of the Solicitors Regulation Authority, the joint administrators secured the effective transfer of rights to handle the claims and work-in-progress (WIP) files of all existing claimants.'

Files are being transferred to other firms, a process being managed for now by Recovery First, which specialises in transferring claims from firms that can no longer handle them.

Tina Flanagan, group HR manager at the firm, posted on LinkedIn that Pure had been forced into administration and staff all made redundant. She added: ‘It was just awful to see so many people’s lives turned upside down. It was an absolute pleasure to work for such amazing people and the board worked night and day to save the business and for that I thank you all.’

It is understood that Novitas Loans, a provider of loans for legal proceedings, petitioned Pure Legal for bankruptcy last month.

A spokesperson for the company told the Gazette: ‘Novitas’ primary aim is to act in the best interests of our customers who have claims being managed by Pure Legal Limited. Our priority is to ensure that our customers are receiving the highest quality of service and care. We cannot comment further on ongoing legal proceedings.’

Pure Legal is an alternative business structure that is part of the Pure Business Group. It is unclear what effect – if any – the closure of the law firm would have on the wider group. The company is owned by Phil Hodgkinson, a former director at Slater and Gordon and Compass Costs. He is also chairman of Huddersfield Town Football Club.

In a statement, the club said: 'Mr Hodgkinson holds 75% of the club’s shares through PURE Sports Consultancy. This company is not part of this action and, as such, is legally unaffected.

'Our board of directors would like to assure Town fans that the club remains able to meet its financial commitments over the short, medium, and long term.'

The most recent annual accounts for Pure Legal Limited, covering the year to 30 March, show that while turnover increase 24% to £18.1m, profit before tax fell by 24% to £3.6m. Creditors were owed £37m within one year, compared with £24m a year earlier, and the company had outstanding loans and overdrafts valued at £21m.

Pure Business Group sold York-based Pryers Solicitors earlier this year, resulting in the transfer of 70 lawyers and support staff. Pure Legal, which was once mostly reliant on personal injury claims, had moved away from that work and handled negligent wall insulation claims, mortgage mis-selling, housing disrepair and data breaches.

A week ago, it was confirmed that Liverpool firm Hampson Hughes had gone into administration, with Recovery First enagaged in finding alternative providers for ongoing work.

 

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