In an unprecedented move, the Solicitors Regulation Authority (SRA) has shut down two Liverpool-based claims firms in a single day, citing regulatory breaches. The firms, Langton Law and BPS Solicitors, both have close ties to McDermott Smith, another Liverpool firm that recently entered administration owing in excess of £37.5 million to creditors.
Photo by Jiamin Huang on Unsplash
BPS Solicitors & Langton Law
The SRA intervened against BPS Solicitors after determining that Alistair Davies, the firm’s manager, had breached the Administration of Justice Act 1985. While there were no allegations of dishonesty or violations of accounts rules, the firm was immediately closed, and Davies, who was admitted by the SRA in 1988, has been suspended.
Similarly, Langton Law Limited was today shut down by the SRA due to suspected failures to adhere to the SRA’s principles, code of conduct, and accounts rules. The firm’s manager, Kathryn Langton, admitted to the SRA in 2009, has also been suspended. Stephensons Solicitors, a firm based in the North West, has been appointed as the intervening agent for both BPS and Langton Law, following their appointment to manage the McDermott Smith cases in July of this year.
McDermott Smith Law
McDermott Smith Law, which went into administration last month, had significantly increased its work in progress and debts in the year prior, with legal funders Fenchurch and others having invested over £30 million within a year. BPS Solicitors, who deal with Housing Disrepair and Financial Mis-Selling Claims amongst others, had taken on some of McDermott Smith’s caseload after it closed and had been registered at the same Liverpool address until April. BPS saw rapid growth in its headcount and financial liabilities, with staff numbers rising from zero to 40, and debts escalating from £110,000 to over £1.8 million within a year.
Langton Law, founded by Kathryn Langton in December 2022, had also been registered at the same address as McDermott Smith until recently. Last week, the firm announced plans to move to new premises in Liverpool’s city centre, but the SRA’s intervention has brought those plans to an abrupt halt.
The swift actions by the SRA underscore the regulatory body’s commitment to maintaining professional standards within the legal sector, particularly in light of the close connections between these firms and the financial instability highlighted by McDermott Smith’s collapse.
What will happen with ongoing cases for clients?
Even though Stephensons has again been appointed by the SRA as Intervention Agents, they will neither be responsible to any creditors of BPS or Langton, nor be progressing any ongoing cases.
Clients who currently have ongoing housing disrepair or motor finance matters are welcome to seek new legal representation, and Stephensons will ensure that any recovered files are forwarded to the new firm to ease the transition.
The sudden closure of a firm can lead to significant challenges for both former employees and clients.It is always sad to see stories like this in the Law Gazette when support staff through no fault of their own find themselves without employment. Equally, there will undoubtedly now be clients who have to find alternative representation without notice.
If you find yourself affected by this situation and require legal assistance, you can reach out to us at 0161 840 1035 today or fill out the quick contact form below for a no-obligation chat.
Please note that we specialise in Housing Conditions claims for tenants in properties owned by housing associations or Councils in England and Wales. Therefore, we may not be able to help you on all matters.
