BDO LIQUIDATORS to Halliwells have lost a High Court case against one of the collapsed law firm’s former partners Michael Burns.
Shay Bannon and Dermot Power, were appointed joint liquidators earlier this year.
The ruling by Mr Justice Warren means liquidators, which have been attempting to claw back money from ex-partners, will not be able to chase Burns after the judge found he was protected by the terms of his retirement deed, Accountancy Age’s sister publication Legal Week reports.
Burns left Halliwells in 2009 to join rival firm DLA Piper. His lawyers argued that his retirement deed protected him from the liquidators’ attempts to retrieve money from partners who were present at the time of, or shortly before the firm’s collapse in 2010.
In December, Burns’ counsel brought an application to strike out the clawback claim issued by BDO, who were then administrators.
A spokesperson for his lawyer said: “These were always unmeritorious claims against our client. We welcome today’s judgment and will continue to defend all of our clients against any further claims advanced by the liquidators.”
BDO liquidators have the right to appeal today’s judgment, but insiders have suggested this is unlikely.
News of Burns’ win comes as former full equity partners are today participating in the second day of a two-day mediation with liquidators, hosted at Addleshaws’ London office.
Mediator Michel Kallipetis QC, the former head of Littleton Chambers, is presiding over the meeting, which sees the liquidators trying to claw back around £21m gained by equity partners through Halliwells’ controversial ‘reverse premium’ property payout on its Spinningfields office in Manchester.
The liquidator duo launched a claim in July 2011 against 32 ex-partners – including former chairman Ian Austin – in a bid to reclaim the money, with the partners agreeing to enter mediation in a bid to settle out of court.
Commenting on the mediation, one former fixed-share member said: “It’s in no-one’s interest for the mediation to fall apart, but this could well happen as the equity partners struggle to apportion blame between them.”
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By threatening creditor returns, the government could undermine the UK’s World Bank insolvency ranking and cost creditors £8m a year, trade body R3 warms
Lee De’ath and Richard Toone, partners at CVR Global, were appointed joint-administrators of Lexden Centre (Oxford) Limited, trading as Colchester English Study Centre (CESC), on 29 June 2016
Peter Saville, Ryan Grant and Anne O’Keefe of AlixPartners will now become the supervisors of the CVA and monitor the implementation of the proposal