A Manchester personal injury firm has closed and transferred around 800 ongoing files to five other practices.

Delta Legal ceased to take on new cases in March after seeing business hit by civil justice reforms last year.

The firm organised its winding down through PI-Solutions, transferring work to the company’s five panel firms.

Delta Legal, which dealt only with PI claims, at one time employed 60 people, although that number had shrunk to 12 by this year. The Gazette understands most remaining staff have secured other jobs in the legal sector.

Managing partner Daren Ismay said: ‘It’s very disappointing that the Jackson reforms have resulted in such a draconian reduction in revenues. Having recognised that the firm wasn’t going to be financially viable going forward, I decided to take immediate action. 

‘By seeking professional advice early, I’ve been able to manage the process, which will improve the situation for creditors and clients alike.’

Delta Legal approached PI-Solutions in January to consider its options after turnover fell steeply. PI-Solutions managing director David Johnstone said the arrangement will allow the firm to achieve almost 100% of the value of its work in progress.

‘Delta Legal acted early and approached us as soon as it recognised there was trouble ahead,’ said Johnstone. ‘The whole process will last for three years with Delta Legal likely to see 40% of recovery value within the first year, 30% in the second year, 20% in the third and the remaining 10% is likely to be sold on a discounted basis.’

Johnstone said more PI firms are likely to close in the coming months as the claims started before the Jackson reforms run out.

PI-Solutions was started in 2013 to broker a sale or run-off for firms of solicitors involved in PI that no longer wish to take on any more work. It provides the insolvency specialists with niche services in its field.

The shrinking of the personal injury market - particularly in the north-west - has been predicted for some time.

In March 2013 a poll of 300 managing partners in the region found almost a fifth were considering closing down their firm.

Since then SRA figures show more than 1,500 law firms have closed across England and Wales.