The merits of litigation funding are presently a hot topic. Benedict Mackenzie have obtained such funding in deserving cases. 

Benedict Mackenzie believe litigation funding can avoid injustice to claimants who have a strong case but do not have the means to bring the claim (a particular issue for liquidators seeking to achieve recovery for creditors). Litigation funding should not be confused with the US contingency model which has seen some notoriously frivolous claims reach court. To secure funding from a professional third party funder, a case must have a strong chance of winning. Claims without merit will not attract backing.  

For specialist advice in this field please contact the partners at our London office or contact info@bmaclondon.com   

The DTI’s latest insolvency figures released today, once again make bleak reading. 3,187 companies suffered liquidation in the last quarter, an increase of 8.5% on this time last year, but business rescue specialists Benedict Mackenzie say many more insolvencies can be avoided if businesses take the time to stand back and review their operations before things get to crisis point.

The biggest increase affecting companies was in compulsory liquidations, where 15.2% more companies than last year were forced into liquidation because of unpaid bills and one or more of their creditors had petitioned the Court for their company to be wound up.

The other huge rise was in personal insolvencies which saw a massive increase of 57.1% on this period last year, the inevitable backlash of people over-spending on credit without the means to pay it off.

Graham Petersen, partner in business rescue and recovery firm Benedict Mackenzie, says “The economic climate is still causing businesses a lot of trouble but sometimes crises can be averted by business owners taking a step back from their company and ensuring they are covering business basics. The three golden rules for companies facing financial difficulties are:

• to reduce costs wherever possible
• to collect in the money owed to the business and
• to manage the cash flow

It is the companies with weak cashflows that are particularly vulnerable when the economic climate is less than perfect.”

Graham advises, “Businesses don’t have to ‘go it alone’. If your business is under pressure then you should seek advice as soon as possible in order that you have the widest range of options available to you and are not necessarily forced into liquidation.”

Businesses that would like more advice on how to avoid insolvency should email info@benemack.com, visit their local Benedict Mackenzie office or log on at www.benemack.com

Rupert Mullins of Benedict Mackenzie warns retailers that they may face a tough time this year. Already Benedict Mackenzie has seen a significant increase in the number of retailers seeking their advice due to poor Christmas sales, the same experience has been repeated at all of their offices throughout the south of England.

Despite recent statistics, that like for like sales had increased by around 3%, this was certainly not the case for all retailers, with sellers of electrical goods being hit particularly hard. This has left a number of retailers suffering from cash flow difficulties in January and without further funds they could face serious problems which will affect their ability to trade.

Rupert Mullins, partner at the Bristol office of Benedict Mackenzie, advises retailers who are facing difficulties to seek the help of their professional advisers or bankers. However without a credible plan to trade out of their current financial situation, they may find that creditors are unsympathetic.

“Some retailers may prefer independent help; in which case they should seek the help of a local insolvency practitioner sooner rather than later” says Mr Mullins. “The sooner they get help the more opportunity there is to turn their business around; if they leave it for another two or three months to see if things ’settle down’ it is likely to be too late and the business could face insolvency.”

More information on Benedict Mackenzie can be found by phoning your closest office or emailing info@benemack.com