Hill & Abbott Limited

Law firms are being forced into insolvency as a result of skyrocketing insurance premiums, with insurance costs now consuming up to 20% of some firms’ annual revenues.

Hill & Abbott Limited, an Essex-based law firm which operated as Viewpoint Hill & Abbott Solicitors, is a recent example to succumb to this epidemic, having appointed Louise Baxter, Dominik Thiel-Czerwinke and Jamie Taylor of Begbies Traynor to act as Joint Administrations in late 2021.

The firm began to experience difficulties as a consequence of a claim that was made for advice given over 5 years before the administration. As a result of the claim, when the firm was undertaking the October 2020 to 2021 insurance renewal, its premiums had soared from the £50k per annum which it had been paying to a quote of £390k per annum, which it later managed to reduce to £220k per annum. This left the firm to find an additional £15k per month to cover the increased premium, in addition to the £4k per month it had been paying previously.

The Covid 19 pandemic also played a notable factor in the firm’s problems, coupled with some senior fee earners having personal troubles, resulting in lower billing positions. The firm was hopeful that the insurance renewal for October 2021-2022 would fall back down to reasonable levels, but the firm was only able to secure a quote of £178k per annum.

Immediately following the Joint Administrators’ appointment, they sold the firm’s business via a pre-pack sale to Pinney Talfourd as a “Successor Practice”. All willing staff were transferred over to the purchaser via a TUPE transfer.

According to the Joint Administrators’ most recent progress report, Paragon Bank holds a floating charge over the firm’s assets valued at £317,400.50, and there will be insufficient funds to discharge the entirety of the charge.

The Joint Administrators estimate that there will be sufficient funds for a dividend to be paid to HMRC.

They estimate the prescribed part of the firm’s net property to be £9,874, which is intended to be distributed to unsecured creditors should there be sufficient funds. It is unlikely that a dividend will be paid to unsecured creditors.

The Joint Administrators’ progress report can be found HERE.

The Joint Administrators have been assisted by Pinsent Masons (legal) and Eddisons (chattel agents).