Recovery First instructed by Delta Legal to run off PI files

Delta Legal, has appointed Recovery First to oversee the managed and compliant run off of 800 personal injury (PI) files, which will allow the Manchester-based personal injury law firm to achieve almost 100% of the value of its work in progress (WIP) over the next three years.

Recovery First, provider of complementary services to insolvency practitioners, accountants, restructuring and corporate recovery specialists helping PI law firms withdraw from the market, was approached by Delta Legal in January when, following the huge changes to the legal landscape last year, it realised it was facing solvency issues.


Insolvency practitioner at FRP Advisory LLP, David Thornhill said: “It was refreshing to have the issues faced by Delta Legal brought to my attention early since the options available for restructuring are greater. In this case, the proactive involvement of Recovery First avoided the problems that can be encountered in disposing of books of WIP, often at a significant discount to their real value. By utilising the efficiencies of the Recovery First panel and its proactive management we believe recoveries for unsecured creditors will be greater than would otherwise have been achieved. In addition, the benefit of avoiding bankruptcy to the sole trader in this case has allowed him to retain his practicing certificate.”

Managing director at Recovery First, David Johnstone said: “Delta Legal acted early and approached us as soon as it recognised there was trouble ahead. At first, we directed the firm to other experts, including independent accountants and insolvency practitioners, who advised on a voluntary arrangement. It was after Delta Legal sought expert advice that it then came back to appoint us.

“The whole process will last for three years with Delta Legal likely to see 40% of recovery value within the first year, 30% in the second year, 20% in the third and the remaining 10% is likely to be sold on a discounted basis.”

The arrangement has seen Recovery First facilitate five panel firms and undertake the transfer process. It will continue to monitor the liquidated value flowing to Delta Legal on case conclusion. In the meantime, Delta Legal will supervise and manage its orderly wind down.

Managing partner at Delta Legal, Daren Ismay said: “It’s very disappointing that the Jackson Reforms have resulted in such a draconian reduction in revenues. Having recognised that the firm wasn’t going to be financially viable going forward, I decided to take immediate action. By seeking professional advice early, I’ve been able to manage the process, which will improve the situation for creditors and clients alike.”

Recovery First is seeing an increasing number in the pipeline as insolvency practitioners begin to recognise that it is possible to avoid the likelihood of a sale at undervalue when selling WIP in claimant personal injury files at a discounted rate and instead realise up to 100% of the value in the WIP through a structured earn out process.

On an outsourced basis, Recovery First works alongside insolvency practitioners, accountants, restructuring and corporate recovery specialists, helping PI law firms withdraw from the market. It helps firms achieve a much higher value than could be achieved by a discounted sale by facilitating, managing and controlling the earn out, so allowing 100% of the incumbent WIP to be realised.

For further information about Recovery First contact 01737 474024 or email

For further media information contact Paula Hunter at PR Hunter on 07739 989915 or