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GT Law becomes latest legal firm to collapse 16 October 2015

GT Law Solicitors, the trading name of First Stop Legal Services, has filed for administration in the latest of a string of legal firm insolvencies.

Andrew Hosking and Simon Bonney of business recovery specialist Quantuma were appointed joint administrators to First Stop Legal Services on October 9.

The appointment came just a week after both Bonney and Hosking were appointed as joint administrators of another law firm – Jeffrey Green Russell.

The administrators of First Stop Legal Services secured the transfer of cases and eight staff to three other law firms – two of which were IC Law in Liverpool and Pilkington Shaw in Liverpool.

There were eight redundancies and it’s understood that former managing director/solicitor Gordon Tucker will join another law firm in the coming weeks.

GT Law was referred to the Solicitors Regulation Authority (SRA) earlier this year regarding its representation of claimants in a failed personal injury case.

The class action lawsuit, representing more than 16,000 people, was brought to the high court by claimants seeking compensation for health problems, that they claimed related to a fire in Merseyside, at a chipboard plant owned by the Sonae Industria company.

But in Saunderson & Ors v Sonae Industria (UK), the judge dismissed the claims, saying the legal process had “preyed on human susceptibility and vulnerability.”


PII deadline
GT Law’s administration emerged as many law firms were being hit by the September 30 deadline for the renewal of professional indemnity insurance (PII) – the cover that effectively permits legal firms to practice.

It’s believed that this deadline may have affected both Jeffrey Green Russell and GT Law in the lead up to their administrations.

A regulatory team at law firm Ashfords, led by partner Sam Palmer, was appointed as solicitor manager for GT Law, advising on regulatory responsibilities, and ensuring that clients’ money and interests are protected.

Palmer was in fact also appointed as solicitor manager for Jeffrey Green Russell on its pre-pack administration.

He said: “This has been a very testing time for both Jeffrey Green Russell and First Stop Legal Services. We were pleased to help both companies find the best possible solution. This has protected the interests of clients, employees and other stakeholders.”

Andrew Hosking, who has been appointed on a number of law firm administrations, said: “We were pleased to work with the specialist regulatory team at Ashfords. The team supported Jeffrey Green Russell and First Stop Legal Services, their directors and staff, through this difficult and challenging time.

“The Ashfords team ensured clients’ interests were protected throughout, and as a result, the transactions ran as smoothly as possible.”

Mishcon de Reya provided insolvency advice to GT Law, and Pinsent Masons provided insolvency advice to JGR.

By Marcel LeGouais

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