REBEKAH CAVANAGH, Herald Sun
February 28, 2017 7:35pm
Subscriber only
VICTORIA’S top barristers have been warned not to do business with Slater and Gordon unless paid beforehand amid concerns about the embattled law firm’s rising debt.
List A Barristers, which represents almost 80 commercial barristers, sent a memo to its members on Tuesday “strongly” recommending work requested by Slater and Gordon “only be undertaken once we hold funds”.
In the email, seen by the
Herald Sun, List A Barristers senior clerk and executive director David Andrews tells its members: “I strongly recommend that if you have any unbilled work you have undertaken on instructions from Slater and Gordon, you prepare and send an account forthwith.
“I recommend even more strongly that any new work offered to you by Slater and Gordon or ongoing work requested by the firm only be undertaken once we hold funds in OUR trust account.
“It is far preferable that we hold trust monies rather than the firm doing so.”
The warning comes as Slater and Gordon faces increasing financial pressure and is at the mercy of its lenders, with their share price yesterday plunging 22 per cent to just 9.8 cents.
The company revealed earlier this week, in releasing its financials for the six months to December 31, its debts exceed its total assets by $126 million.
Its cash flow is also $11.4 million in the negative.
Shareholders have been worryingly watching the business closely after its share price collapsed from an all-time high of $7.85 in April 2015.
The decline came following the purchase of its UK business in March 2015, which led to a loss of $1.02 billion the next financial year.
The firm has been given until May 26 to plunder a deal with its bankers on a restructure plan. If unsuccessful, it could be made to repay a $738 million loan within 14 days.
Mr Andrews would not discuss the email when contacted by the
Herald Sun last night.
“I’m not going to talk about that,” he said.
Slater and Gordon spokeswoman Kate Van Poelgeest said the firm would not comment on “rumours sourced from leaked memos”.
“Slater and Gordon has enjoyed strong relationships with Australia’s leading barristers for many decades, through good times and bad and we expect to continue to enjoy those strong relationships for many decades to come,” she said.
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