Midlands News / 25 Mar 2015
Manolete to take action against “unlawful” Silverstone contract termination
Manolete Partners, an insolvency litigation investment company backed by renowned private equity financier Jon Moulton, is poised to take High Court action against Silverstone Circuits Ltd (SCL) after its “sudden” termination of a hospitality contract contributed to a company’s collapse.
Insider revealed in January that Jo Milner and Stephen Cork, partners at insolvency firm Cork Gully, were appointed to Silverstone Hospitality Ltd by its directors the day before Christmas Eve.
It was understood that the business employed 24 full-time staff, all of whom were made redundant. It also employed hundreds of additional temporary employees for events.
Manolete branded SCL’s termination of its five-year contract with Silverstone Hospitality, which had provided catering for the British Grand Prix, as “unlawful”.
It has now purchased all claims against SCL following a breakdown in discussions instigated by administrators and revealed it plans to launch formal legal proceedings through the High Court within weeks.
It added that a “large majority” of the proceeds from claims would be returned to the creditors of Silverstone Hospitality.
Steven Cooklin, chief executive of Manolete, said there was a “very strong claim for repudiatory breach of contract against Silverstone Circuits”.
A document seen by Insider revealed that Silverstone Hospitality had instructed Ferdinand Kelly Solicitors for advice regarding SCL’s termination prior to its administration. A letter was sent to SCL outlining a potential claim for damages totalling £2.5m.
The report, which was published by administrators on 13 February 2015, added that any recovery from SCL would “represent a significant asset” to Silverstone Hospitality and its creditors.
It was also revealed that unsecured creditors of Silverstone Hospitality had lodged claims for more than £506,000, including £409,599 due to trade and expense creditors.
Cooklin added: “The administrators have given Silverstone Circuits an opportunity to settle the matter but those efforts have come to nothing.
“Silverstone Hospitality has been forced into an unwarranted insolvency and the company now simply does not have any funds available to pursue its wholly meritorious claim.
“Manolete Partners exists to give such companies access to the British justice system. We are left with no choice but to issue the claim through the Courts.”
Insider contacted SCL but the business declined to comment.
Manolete is financed by Jon Moulton, the founder of Better Capital, which owned collapsed courier City Link.