Insolvency litigation is different. Most defendants we are faced 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 almost always many of the small supplier firms that have loyally supported the failed 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 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 case. Litigation is by its very nature costly and carries a high level of risk.
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 who will fund the other cash costs of the case including:
• Barristers fees
• Experts' fees and expenses
• Court costs
• ATE premiums
• 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.
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 selling the claim to Manolete the IP removes himself 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. He 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 own costs and the liability for the defendant’s costs if the case is lost.
Where we are funding the IP to pursue the case, we ensure that a full funding and risk protection package is delivered – all the costs (including ATE premiums and Security for Costs funding) are solely for our account.