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Resignations led to Morisons' collapse, administrators report
The collapse into administration of solicitor firm Morisons resulted from a number of partners giving notice of their intention to leave for rival practices, the Scotsman has reported.
Morisons folded at the end of March, and a report by the administrators, from FRP Advisory, has revealed that in the preceding weeks a number of partners, in both the Glasgow and Edinburgh offices, had given their contractual six months' notice or were in discussions with other firms.
With the administration it was announced that Blackadders were taking on most of the Glasgow business, along with three partners, and Thorntons much of the Edinburgh operation, along with eight partners. Three other partners have moved to Gilson Gray, Weightmans and Allan MacDougall.
The report states that the initial departures would have resulted in "a significant loss of both clients and turnover", and the other partners were concerned that they would result in the business no longer being financially viable due to the level of fixed costs.
Advice confirmed this, and having failed to achieve a deal for the acquisition of the firm, the administrators were called in.
They estimate a shortfall of around £1.6m in assets available to pay creditors. Management accounts for the period ending 28 February show a net profit of £950,000 on a turnover of £4.9m.