Access to Justice
The Manolete model gives significantly quicker resolutions and better returns to creditors. More just outcomes are a vital element to how we approach our casework.
Insolvency litigation is different. A great many of the defendants we face with take the view that: “the company has gone bust, so we don’t have to pay our debt to it”. But who suffers? The answer is all creditors – not just the banks and HMRC, also many of the staff and invariably many of the small supplier firms that have loyally supported the company over many years.
While few or no assets may be left in the company, a potential litigation claim may represent a real opportunity to recompense those who have lost out.
Insolvency Practitioners (IPs) are faced with a difficult challenge. They have a duty and a strong desire to maximise returns to all creditors, while at the same time they act with personal liability and often have little or no funding to fight a potential meritorious case. Litigation is by its very nature costly and carries a high level of risk (including Adverse Cost risk and the threat of Security for Costs).
Funding can be an insurmountable barrier to pursuing a claim, no matter how strong the merits of the case. Even if solicitors can be persuaded to work on a CFA (“No Win/No Fee”) basis the question remains who would fund the other cash costs of the case including:
- Barristers fees
- Experts’ fees and expenses
- Court costs
- ATE premiums
- IPs ongoing costs
- Other various cash disbursements
On top of these considerations defendants will often seek a Security for Costs order – asking for claimant funds to be lodged with the court to cover the defendant’s costs in the event that the claim against them is successfully defended. This is often a legitimate request as the claimant is, after all, insolvent. The Court of Appeal has ruled that Security for Costs cannot be satisfied with a voidable ATE policy. Many of these cash and risk demands can defeat an otherwise completely meritorious claim. Manolete Partners provides the solutions and a viable and attractive route to justice. We specialise exclusively in insolvency claims and litigation. By assigning the claim to Manolete, the IPs removes himself/herself completely from all cost burdens (including adverse cost risk), receives an immediate cash injection into the insolvent company and transfers all cost liabilities to us.
The IPs can then look forward to recovering a very significant share of the cash proceeds on a successful conclusion to the case, without the concern of his/her own costs and the liability for the defendant’s costs if the case is lost. Manolete also pays for any of the IPs team’s work needed to pursue the case. On some cases we also cover in full the cost of keeping the administration or liquidation open while the litigation runs its course. Where we are funding the IPs to pursue the case, we ensure that a full funding and risk protection package is delivered – all the costs (often including IPs case-related work) are solely for our account.