M1 Legal Committed To Supporting Club La Costa Investigation.
The Club La Costa (CLC) administration process is now firmly in the hands of the ‘creditor’s choice’ administration firm (FRP), following a several month handover processes from the original administrators, BDO. What do we know at the moment?
The process needed funding
BDO (whose role was officially a neutral one) seemed very reluctant to give way to the creditor’s choice FRP, and a substantial legal case was necessary to remove them from office. BDO had not originally recognised our clients as creditors although this again was resolved by diligent legal actions carried out by our legal team.
The costs expended by BDO and their lawyers during this period of apparently neutral litigation amounted to almost £400,000 with the result that the funds remaining to hand over to FRP advisory (FRP) to pick up the investigation were severely depleted. An M1 Legal spokesperson opined: “It’s almost as though CLC’s spending was accelerated in order to leave FRP with nothing to use for their own investigations.”
The low amount of money “in the pot” left the process in urgent need of funding.
M1 Legal provides the necessary funding
We have already footed a six-figure bill to push for BDO to be dislodged and will continue our 100% commitment by providing the support necessary in order to bring CLC to justice. FRP have appointed Mishcon De Reya as their UK lawyers in the administration, who are also very familiar with this type of investigation. We have pledged to fund the ongoing administration until sufficient funds are recovered to allow FRP to ensure the investigation of this administration is given the resources it needs to make meaningful realisations for the creditors.
Administration to be extended
FRP has indicated that one of their first steps will be to request a 12-month extension of the CLC administration; a request which is expected to be welcomed by the creditors. The extra time is key to recover funds that were not forthcoming during the BDO administration. Our sources are “fully confident” there is an enormous amount of untapped assets and funds to be sourced on behalf of CLC creditors.
M1 Legal confident of justice for their clients
We are handling around 1500 claims against CLC, worth £millions of pounds and are confident of justice.
FRP has indicated that there is a lot of work to do to investigate the CLC companies, and we are expecting them to uncover significant financial along with other issues in the course of their investigation with numerous sources now providing information to the administrators.
Claims against CLC still going ahead
Club La Costa and their publicity agents (RDO, KwikChex and their subsites) are broadcasting the message that compensation claims against the timeshare giant are futile, that there is no money and no chance of success. However, we know that this is not true at all, its just a scare tactic to avoid even more CLC owners seeking legal representation and becoming claimants in the administration.