UK Law Firm To Fight £19 Million 'Bad Advice' Case

by Robin Pilgrim, LawAndTax-News.com, London

05 May 2003

It has emerged that technology, media, and telecoms specialist law firm, Olswang is facing a £19 million High Court claim over allegations that the firm gave bad advice, and that team members were absent at crucial points of a share sale deal.

The Lawyer.com news service reported last week that 10 shareholders in UK software company, Omnibus have alleged that the company's failure to advise their firm properly meant that they received only £842,500 for the sale of 100% of Omnibus' shares - worth £24 million - to a German firm, MDAG.

According to the claimants, who are seeking damages for breach of contract and negligence, MDAG had advised before completion that it would not be able to pay them, at which point they endeavoured to extricate themselves from the deal. However, as a result of alleged negligence on Olswang's part, the shareholders were forced to go ahead, receiving just £842,500 in payment before MDAG went into liquidation.

The claimants have suggested that the absence of the partner leading the deal, Stephen Hermer, at the completion meeting contributed to this unsatisfactory outcome.

Speaking on behalf of Olswag last week, risk management partner, Marcus Barclay announced that:

'We regret the fact that the claim has been made. It's in the hands of our solicitors and will be vigorously defended.'

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