Sandstone Legal - Case Update

Embattled law firm Sandstone Legal’s non-legal assets have been acquired by creditor Seven Stars Legal, while client files have been taken over by other law firms.

Sandstone Legal operated as a provider of legal services specialising in flight compensation claims, Plevin PPI claims, housing disrepair claims and debt recovery. All of the firm’s services were carried out on a 'no win, no fee' basis, meaning that the firm was required to seek funding from litigation funders, including Seven Stars, to cover the costs necessary to purchase and progress clients’ claims.

The firm struggled into late 2024, facing a winding up petition by Medico-Legal Services, owed circa £350,000. According to the joint administrators, the firm had also failed to pay interest owing under a funding agreement with a major creditor, and had even mounted a meritless challenge to this funding agreement, which resulted in the creditor having no other option but to bring a successful application for a proprietary and freezing injunction against the company in late 2024.

In late February, the High Court appointed Philippa Smith and Jessica Thomas of Smith & Barnes — already the interim receivers — as joint administrators of the company. By that point, the Court had rejected a prepack proposal made by solicitor Andrew Settle, the firm’s sole director, which the Court found to be misleading and based on material inaccuracies.

Now, Seven Stars has completed the successful acquisition of the non-legal assets and procured the transfer of the firm’s case load to four other client firms – Brandsmiths, FDM Law, 56 Law and Justizia. Andrew Gregory of Leonard Curtis worked as solicitor manager to ensure legal cases progressed pending the sale of assets.

Meanwhile, Mr Settle has denied misleading the Court in the prepack approval application.

Read the joint administrators’ proposals HERE.

Professionals involved:

• Benjamin Lafferty of Exchange Chambers (instructed by Ward Hadaway) for the joint administrators, Philippa Smith and Jessica Thomas of Smith & Barnes

• Catherine Doran of Radcliffe Chambers (instructed by Mezzle Law) for Andrew Settle

• Louis Doyle KC of Kings Chambers (instructed by Brandsmiths, whose team consisted of David Seligman, Ewen Sharpe, Myrto Sevdali, Courtney Bryan-Isaacs and Iona Barron) for Seven Stars (whose team included Leon Clarance)

• Eleanor Vickery of Selborne Chambers (instructed by Kuit Steinart Levy) for Medical-Legal Appointments, the petitioning creditor

• Duncan Heath of Enterprise Chambers (instructed by Harper James) for TrueHaven SPV, a creditor