UK: Pure Legal: 150 ex-clients chase collapsed firm to recoup crippling losses

UK Law Society Gazette

round 150 former clients left nursing huge costs bills are pursuing a collapsed firm to recoup their losses, the Gazette has learned.

Initial letters of claim for professional negligence in two test cases have been sent by ex-clients of north-west firm Pure Legal. They allege that their cases were either meritless or not pursued and that they were left with unexpected costs orders when they failed.

It was revealed a year ago that national practice Hugh James and other law firms were appealing for ex-Pure clients to come forward if they faced costs orders.

Hugh James now has a growing list of clients, many of who say they have been left destitute after being told by Pure they had claims for cavity wall insulation or mortgage mis-selling.

Neil Stockdale, head of group actions for Hugh James, said in most cases the clients had no idea they had costs orders against them until after Pure went into administration in 2021. Some are still finding out about costs orders.

‘It’s a sorry state of affairs, some of the individual stories we hear are awful,’ said Stockdale. ‘One woman had bailiffs turn up at the house when she was heavily pregnant. Many have had to take out loans at high interest rates just to pay off these orders.

‘They were told it was no win, no fee and some took out loans with [a legal lender] to cover disbursements. The clients thought they were fully protected and two years later they are in debt with bailiffs at the door.’

Ex-Pure clients bringing claims for professional negligence seek to recover losses collectively totalling more than £2.5m with an average claim value of £35,000. Costs orders against them range from £6,500 to £90,000.

Both test cases are being contested in full by Pure’s indemnity insurers, who would be required to meet the claims.

Pure Legal owes an estimated £50m for business interruption loans and to industry creditors. The latest report on the administration, which has so far cost £6m, said it was doubtful that any creditor would receive a return.