Texas American sues Facia team

Hammond Suddards, the Manchester-based solicitor and adviser to controversial businessman Stephen Hinchliffe, has been pulled into the growing row over the pounds 60m collapse of his Facia retail empire.

The law firm is one of five defendants named in a writ by would-be Facia purchaser Texas American Group, which it said was lodged with the High Court on Friday. Others named include Hammond Suddards partner Patrick Jolly as well as Mr Hinchliffe and fellow Facia directors Christopher Harrison and Gary O'Brien.

The US group is claiming damages for alleged misrepresentation after spending, it claims, $750,000 (pounds 496,000) in pursuing the purchase of Facia just before it collapsed at the beginning of June. This weekend, none of the directors was available for comment, but Mr Jolly expressed surprise at the move and vowed to fight any claims.

The SFO is already investigating the crash and is still logging vanloads of documents seized 10 days ago in raids on five premises, including Mr Hinchliffe's homes and Facia's headquarters. Last week, Facia's creditors met in London and heard that they may only receive a pounds 700,000 payout on unsecured debts of up to pounds 60m, which includes a pounds 30m claim from retail giant Sears.

Several small suppliers to Facia have already gone bust as a result. Facia's secured bank lenders, however, have already been paid more than pounds 8m.

The receivers are continuing to investigate millions of pounds of loans and fees paid to Mr Hinchliffe and his web of private companies and still hope to recover pounds 5.6m for creditors.

Among the assets they are also trying to trace are 100 company cars, including Mr Hinchliffe's Mercedes, with its personalised SH1 number plate, and Mr O'Brien's Mercedes and Aston Martin Vantage Volante, which bear the number plates M1 GOB and VV1.

Last week Mr Harrison, the other Facia director, finally provided sworn statements - which were due by law within 21 days of the collapse - on the seven Facia firms. Only one, for the Salisburys luggage shops, arrived in time for the meeting, but it showed that he estimated that the chain was already insolvent to the extent of pounds 10m at the time of the crash.

Salisburys was the first of Facia's purchases, in August 1994, and Hammond Suddards is understood to have advised Mr Hinchliffe from January that year. The firm gave legal advice during the talks with Texas American Group, which started in February this year and were ended by the receivership.

It is also representing Mr Hinchliffe in proceedings by the Department of Trade and Industry to disqualify him and Mr Harrison as directors after the collapse of tennis court maker En-Tout-Cas in 1993.

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