Dentons to probe into Herbert Smith's role as adviser to failed Independent

LIQUIDATION: six provincial law firms join those considering multi-party action

City firm Denton Wilde Sapte has been retained by Pricewaterhouse-Coopers - the provisional liquidator for collapsed insurance company the Independent - to investigate the role of its former advisers, including City firm Herbert Smith.If Dentons decides to investigate Herbert Smith fully, both firms will be investigating each other simultaneously.

Herbert Smith was appointed to investigate Dentons over its advice to another embattled insurer, the Equitable, in April.PwC partner Mark Batten said Dentons was appointed with a wide brief to review all advisers to the Independent.Herbert Smith continues to act in the meantime for PwC on the provisional liquidation.

Mr Batten said: 'They have a wealth of information about the transactions of the company and will not need to get up to speed.'He said Herbert Smith had been scrupulous in putting in place Chinese walls to prevent any potential conflict of interest, though he added that if any conflicts issues arose, Dentons would advise on that in due course.Michael Steiner, the partner at Dentons carrying out the investigation, said he was looking at the role of the advisers, but not specifically at Herbert Smith.

Of Herbert Smith's investigation into his firm, he said: 'It is certainly a strange coincidence.'Meanwhile, six unnamed provincial law firms who have indemnity cover with Independent have added themselves to the list of those interested in joining a multi-party action planned by City firm Class Law to recover losses incurred following its collapse (see [2001] Gazette, 5 July, 3).The Class Law partner responsible for the case, Stephen Alexander, said he is investigating all advisers in the case.

Referring to Independent's former chief executive Michael Bright - blamed by many for the company's demise - Mr Alexander said: 'It is inconceivable that a case of this magnitude can be laid at the door of one man.

The question we are asking is to what extent he was aided by the negligence of other parties.'He added that the case is now 'a long way down the line'.Terence Mowchenson QC of Wilberforce Chambers, has been appointed counsel to the class claimants, and Mr Alexander said action might begin in September.Jeremy Fleming