How Many Lives Were Impacted by the Law Firm Collapse?

The sudden closure of Sheffield-based PM Law on 2 February has left tens of thousands of live cases in limbo, impacting hundreds of employees and clients mid-transaction, particularly in house sales and personal injury claims. The Solicitors Regulation Authority (SRA) has intervened, taking control of client files and funds, while launching efforts to assist affected clients.

Last updated: 30 October 2023 (BST)

What’s happening now

The abrupt closure of PM Law has resulted in significant disruption across the legal landscape in the UK, particularly affecting clients in Yorkshire, Derbyshire, Cumbria, and Berkshire. The SRA's intervention aims to protect clients and facilitate the transfer of ongoing cases to ensure that individuals can continue their legal matters without undue delay. Emergency grants have already been issued to assist clients with urgent needs, such as those involved in house sales already under contract.

Key takeaways

PM Law closed unexpectedly on 2 February, affecting thousands of cases.
The SRA has taken control of client files and funds to assist affected individuals.
Emergency grants are being issued to clients facing urgent financial strain.
Over 100 courts have been informed about the closure's implications for ongoing litigation.
Clients are encouraged to apply for compensation through the SRA’s fund for missing funds.

Timeline: how we got here

Key events leading to the closure of PM Law include:

2 February 2023: PM Law abruptly closes, impacting employees and clients.
3 February 2023: The SRA intervenes, taking possession of client files and funds.
February 2023: SRA issues emergency grants to clients facing urgent needs.
March 2023: Over 100 courts notified of the closure's impact on litigation.

What’s new vs what’s known

New today/this week

The SRA has confirmed that it is actively engaging with clients and has processed over 50 applications for its compensation fund since the closure. Emergency payments are reportedly underway for some clients, indicating a proactive response to the crisis.

What was already established

Prior to the closure, PM Law was a significant player in the legal sector, with over 600 employees and a network of firms. The SRA's intervention is a standard procedure in such situations, aimed at safeguarding client interests and ensuring continuity of legal support.

Impact for the UK

Consumers and households

The closure of PM Law has caused immediate financial and emotional distress for many clients. Individuals involved in house sales, such as Rich Fifield, have found themselves liable for mortgage payments without the necessary legal support to manage their transactions. The SRA’s emergency grants aim to alleviate some of this pressure, but uncertainty remains for many clients about the status of their cases.

Businesses and jobs

With PM Law's closure, over 600 jobs have been lost, significantly impacting the local economy. The legal sector may also experience disruption as clients seek new representation, potentially straining other firms as they absorb these cases. The SRA’s intervention agents, Gordons LLP, are likely to play a crucial role in managing this transition and supporting affected clients.

Policy and regulation

The SRA's swift action reflects its regulatory responsibilities to ensure client protection in the legal profession. The ongoing investigation into PM Law will likely lead to further revelations about the firm’s operations and any underlying issues that contributed to its sudden closure. Regulatory bodies may also reassess oversight mechanisms to prevent similar future occurrences.

Numbers that matter

600+: Employees impacted by the closure of PM Law.
£175,000: Amount Rich Fifield is seeking from the compensation fund.
50+: Applications received by the SRA for compensation since the closure.
100: Courts notified about the potential impact on ongoing litigation.
Tens of thousands: Live cases affected by the firm's closure.

Definitions and jargon buster

SRA: Solicitors Regulation Authority, the regulatory body for solicitors in England and Wales.
Intervention: A process where a regulatory body steps in to take control of a firm to protect clients and their interests.
Compensation fund: A fund established to compensate clients who lose money due to the misconduct of solicitors.

How to think about the next steps

Near term (0–4 weeks)

Clients should stay in contact with the SRA and Gordons LLP for updates on their cases. Applying for compensation through the SRA's fund should be a priority for those adversely affected by the closure.

Medium term (1–6 months)

As the SRA continues its investigation, clients should monitor the situation for developments regarding their cases and potential compensation outcomes. Consideration should also be given to seeking new legal representation as necessary.

Signals to watch

Updates from the SRA regarding the status of ongoing investigations.
Notifications from Gordons LLP about case management and support for affected clients.
Changes in regulations or policies from the SRA that may impact the legal profession.

Practical guidance

Do

Stay informed by following updates from the SRA and Gordons LLP.
Apply for compensation promptly if you are affected.
Seek new legal representation if necessary.

Don’t

Don’t panic; the SRA is working to address the situation.
Don’t ignore notifications or requests for information from the SRA.
Don’t hesitate to ask questions about your case status.

Checklist

Have you applied for compensation from the SRA fund?
Are you in contact with Gordons LLP regarding your case?
Have you considered alternative legal representation?
Are you keeping track of updates from the SRA?
Have you assessed your financial situation in light of the closure?

Risks, caveats, and uncertainties

As the situation surrounding PM Law continues to evolve, there are inherent uncertainties regarding the timeline for compensation and the resolution of ongoing cases. The SRA's investigation may uncover further complications, and clients should remain cautious while navigating their legal matters. It is advisable to seek professional guidance where necessary to mitigate risks associated with transitioning legal representation.

Bottom line

The unexpected closure of PM Law has created significant disruption for clients and employees alike, with the SRA stepping in to manage the fallout. Clients are encouraged to apply for compensation and remain informed about their cases as the situation develops. The long-term implications for the legal sector and affected individuals are yet to be fully realised, and vigilance will be crucial.

FAQs

What should I do if I'm a client of PM Law?

If you're a client of PM Law, it is essential to contact the SRA or Gordons LLP for updates on your case and apply for compensation if necessary.

How can I apply for compensation from the SRA?

To apply for compensation from the SRA, visit their website for guidance on the application process and required documentation.

What types of cases are affected by PM Law's closure?

PM Law's closure has impacted various cases, including personal injury claims, house sales, and probate matters.