A law firm has collapsed and blamed the impact of the coronavirus.

Darlingtons Solicitors, which employs 16 qualified lawyers and eight other staff at its Edgeware office, has gone bust. The firm was established in 1999 by father and son David and James Swede.

It made lay-offs three days before the prime minister announced the lockdown on 24 March, said a source.

Support staff were "'offered'" three months' unpaid leave but furlough was refused point-blank "without explanation", said the insider. Trainees "were simply 'let go' before being offered their positions back if they agreed to work without pay", they said. 

"Within three weeks of lockdown the word began to spread that the firm was actually a dead Norwegian Blue parrot and not just pining for the fjords of Edgware High Street", said the source.

David Rosen, a partner at the firm and a Professor of Law at Brunel University, confirmed that Darlingtons had gone to the wall, and blamed the pandemic. Speaking on behalf of Managing Partner James Swede, he said "Darlingtons is unfortunately one more victim of the economic effects of the coronavirus".. 

"Our work pipelines were dramatically adversely impacted as early as February and we took early and prudent commercial steps to protect the business", Rosen told RollOnFriday.

But, "ultimately, the bank rejected our efforts to refinance and borrow money, when work in our dominant property department dramatically ceased, leaving us with few options to continue to trade". 

He said the firm was "engaged in a managed wind down" and had self-notified the SRA. 

The firm's website has yet to mention that it has closed, informing visitors that "We remain open for business albeit in a new way", and promising "we will see you on the other side!"


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Warning: warning contains inaccurate warnings.


"We are devastated that the outcome of our efforts to save the practice failed. Without the support of the bank, we were left with no choice", said Rosen.

"We are devastated that our loyal employees and staff have been made redundant. We couldn’t continue to pay them, and neither could the partnership draw from profit, where none existed. We wish all of our staff well in these difficult times".

While the impact of coronavirus is huge and ongoing, small firms in precarious relationships with their lenders appear far more vulnerable than most. Larger firms with multiple practice areas have said they are well-placed to adapt to the crisis, while others are bringing in a number of measures to contain the adverse effects. Sadly, Darlingtons will not be one of them.

Tip Off ROF

Comments

Anonymous 15 May 20 09:18

Sad to read about another firm collapsing. Hope the staff manage to get other jobs soon. 

Anonymous 15 May 20 09:33

Transactional work will be slow to recover - if you're going to qualify, choose private client - family feuds, death and taxes will be your constant and unwavering companions standing by your side throughout your career.

Anon 15 May 20 10:37

Well done RoF. You've finally woken up to the fact that Covid is going to put a whole bunch of lawyers out of work. It's only taken you two months but better late than never. Now you've caught up, you might want to bear Darlingtons in mind the next time you come to write another whinge about the injustices of Magic Circle trainees no longer having access to the subsidised canteen and junior lawyers having to buy their own biscuits. 

Anonymous 15 May 20 10:56

Unfortunately, there will be many more small firms to follow. The bread and butter transactional work has disappeared, probably for many months. Without this fee income and adequate funding smaller firms just won't have the capital to survive. I wish everyone there well.

anonymous 15 May 20 14:33

Surprised that this firm cannot continue after only 2 months of covid.   No working capital ?

Anonymous 15 May 20 15:26

@14:33

I share your surprise at how few firms have instantly hit the rocks in such a short timeframe. Especially if they could furlough staff and just be left with overheads for a couple of months. Worrying times. 

William Burke 15 May 20 18:55

I'm training to be an undertaker.

Regular work.

Never dries up.

And if I need a  bit extra it's no big deal to go out and drum up a bit of business.

anonymous19 15 May 20 18:56

Wouldn't accept furlough for staff can only mean they were going bust before the Covid 19 !!   Why else would you not do this for your loyal staff  !!!

Anonymous 16 May 20 00:29

The first case of covid was registered 28th feb in UK.  Darlingtons pipeline was affected early as February. Clearly they have advance warning system. Interesting the firm runs out of capital by March.  Rosen seems to have had the heads up on covid. He should have been task force for the government. 

Anonymous 16 May 20 13:25

@ Anon 15 May 20 10:37

Biscuits don't buy themselves you know.

And those little wooden boxes of boutique teas in the meeting rooms made great presents.

It's a damn shame.

Anon 17 May 20 08:52

They put us on unpaid leave so they could keep as much money in the business for them to take out before closing down. Could have easily furloughed 

Anon 17 May 20 17:20

Partners too everything out the business. Why would the bank support ? For them to take more out ? Even the banks are not stupid 

Vijay Parikh 18 May 20 16:51

Saddened to hear this news about my previous firm.  I wish the staff and partners the best for the future. 

Anon 19 May 20 17:26

The firm was clearly in trouble before COVD-19 to suggest that this was the sole cause is ridiculous; it was just the nail in the coffin.  It is sad for those employees who are left high and dry by mismanagement.  The firm presumably had no buffet whatsoever as they closed rather than offering the furlough scheme.

Fat Freddie's Cat 20 May 20 13:46

The firm presumably had no buffet whatsoever

Better off out then.  At A&O they've got about 10 main courses  more if you include the pasta bar.

Anon 21 May 20 21:16

At one point this firm has so much potential. It lost too many good people over the years. Few years back an entire team of lawyers left. 

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