NHLEX Limited trading as Novum Law and Hyphen Law - Case Update

The joint administrators of a collapsed law firm have secured a five-year extension to the administration to allow a WIP earn out agreed as part of a pre-pack deal to complete.

Asher Miller and Stephen Katz of Begbies Traynor were appointed joint administrators of NHLEX Limited, which traded as Novum Law and Hyphen Law, in March 2024. The company—which typically pursued claims on a contingent "no win no fee" basis—had faced cash flow challenges since the onset of the COVID pandemic, which slowed the court system and therefore the realisation of accrued work in progress.

On their appointment, the administrators entered into a pre-pack deal with national law firm Simpson Millar, which purchased Novum Law’s assets and trading name. Under the terms of the deal, NHLEX is to receive one-third of all billing eventually achieved on transferred cases. The sale consideration is payable over a five-year period post-completion whilst the transferred matters are progressed and reach their conclusion. As a result, the administrators sought a five-year extension from the first anniversary of their appointment.

At this time, the administrators anticipate that senior secured creditor HSBC, owed over £2.1 million, will receive a return, while the potential of a return to secondary secured creditor and fellow law firm Thrings LLP, owed £2.8 million, is less certain.

Read the joint administrators’ most recent report HERE. They have been assisted by Kingsley Napley.