A High Court judge has given lawyers and clients a warning about setting deadlines after receiving an evening email to say a hearing could not wait.
The Honourable Mr Justice Fancourt explained that his clerk was emailed by lawyers at 7.52pm last Thursday asking for an urgent hearing that same evening, to deal with the pre-pack sale of Nationwide Crash Repair Centres Ltd. The email was attached with weighty bundles, a skeleton argument and a certificate of urgency.
Initially it was thought that applications to appoint administrators would be heard the following morning, but another email from lawyers at 9.16pm said that a deal agreed with a purchaser would be pulled if not completed by midnight. The hearing was held by telephone that same evening and the order finally made at 11.56pm. It later transpired that the midnight deadline had been included in contract documents negotiated over the previous days.
Mr Justice Fancourt said there was nothing in the circumstances that required such urgency, and the deadline was only necessary because of terms agreed outside the court’s control.
The judge added: ‘It is wholly unacceptable for clients and lawyers and other professionals acting for them to negotiate terms that have the effect of presenting the court will an artificial ultimatum and require important matters affecting the livelihoods of thousands of people to be decided under undue pressure of time.’
He stressed that the court was not to be treated as a ‘rubber stamp’ for the appointment of administrators and that applicants should give time for a fair hearing to be held.
Administrators from PricewaterhouseCoopers LLP were appointed to handle the sale of the repair business to listed company Redde Northgate, which also owns law firms NewLaw Solicitors and Principia Law. The court was told that the sale would bring an immediate return to secured lenders of around £26.7m and save almost 2,900 jobs. The only realistic alternative was to force Nationwide Crash Repair Centres into liquidation, with all jobs lost and returns reduced to £19m.