Worrying trend in collapse of legal firms continues
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, coming just a week after administrators were appointed to serve the failing law firm Jeffrey Green Russell.
GT Law is believed to have been in difficulties following a referral to the Solicitors Regulation Authority (SRA) 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. They claimed it related to a fire in Merseyside at a chipboard plant, owned by the Sonae Industria company.
However in Saunderson & Ors v Sonae Industria (UK), the judge dismissed the claims saying the legal process had “preyed on human susceptibility and vulnerability.”
An additional contributing factor, which has affected many firms including GT Law and Jeffrey Green Russell, was the September 30 deadline for the renewal of professional indemnity insurance (PII) – the cover that effectively permits legal firms to practice. It is believed to have added pressure to already difficult times in the lead up to filing for administration.