Watchstone Group has said that Slater and Gordon intends to pursue a claim against the company for £600 million for fraudulent misrepresentation after its disastrous purchase of Quindell’s legal division in 2015.
The Australian-headquartered firm has said that it would not have bought the division from Watchstone Group (when it traded as Quindell) if the claims management company had not fraudulently misrepresented its business position.
In a statement to the London Stock Exchange, Watchstone Group said that it had received further correspondence from a firm of solicitors acting for Slater and Gordon Limited stating that it intended to issue proceedings by the end of this month.
“Its letter states that SGH intends to make a claim for a total amount of approximately £600m on the basis that but for fraudulent misrepresentation it would not have entered into the transaction at all,” said Watchstone.
It added that a “groundless claim” for fraudulent misrepresentation was dismissed by an independent barrister in respect of the warranty escrow process relating to the sale of the division in November 2016. It said that the opinion on that claim, which was formed on the basis of evidence provided by both Slater and Gordon and Watchstone, stated that a misrepresentation claim was not a bona fide claim with a better than 50% prospect of success.
“Watchstone denies any misrepresentation in the strongest terms and remains satisfied that neither the warranty claim nor a misrepresentation claim have merit and will defend such claims robustly if proceedings are brought,” said the company.
It also said that Slater and Gordon has “continuously declined to disclose key evidence in its possession” which would be relevant to the merits and quantum of its purported claims.
“Watchstone believes this evidence will be available to it in the event that SGH issues proceedings and it intends to seek disclosure of such information at the earliest possible opportunity,” it added.