Claims Direct applied for an administration order this week following accusations that the company had retained some or all of its clients’ damages.
In a statement, Claims Direct said it would have preferred that the company had been able to implement its new business model and resolve its differences with defendant insurers without seeking the protection of an administration order.
Under the company’s previous model, the costs of taking out insurance to cover a possible defeat saw succesful personal injury claims almost wiped out. Now solicitors on Claims Direct’s books take out insurance for their clients, charging a success fee recoverable in the courts.
The company was forced to apply for administration after it failed to raise the funds it required to stay in business. Its shares were suspended at 3¬p, valuing the company at less than £6m.
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Steve Absolom and Will Wright from KPMG Restructuring have been appointed joint administrators to City Motor Holdings and associated companies
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Begbies Traynor have been appointed administrators of William Anelay Ltd, York, one of Britain’s longest-established construction and heritage restoration companies