2006 merger have failed, ending up in the High Courts.Delhi and Kolkata-headquartered FoxMandal and Bombay solicitors firm Little & Co attempts to rescue their
The Financial Express reported that FoxMandal managing partner Som Mandal filed a criminal petition against the management of Little & Co for having cancelled the memorandum of understanding that was the basis of the firms’ merger in 2006.
Under the proposed merger MOU that would create FoxMandal Little, a number of FoxMandal Delhi partners were to own 45 per cent of Little & Co’s equity, which could increase to 50 per cent in 2009, reported the Express.
According to the paper, FoxMandal Delhi paid Rs 6 crore to Little & Co in seven instalments between May 2006 and April 2008.
The break-up between the firms has been in the offing for years now.
In December 2009, after Legally India reported that FoxMandal Delhi was not able to pay its lawyers’ and partners’ salaries due to a cash crunch, Little & Co had purported to cancel the MOU between the firms.
The 15 December 2009 letter of more than 7,000 words from Little & Co partners to FoxMandal, which Legally India has seen, made allegations against Som Mandal and six other FoxMandal partners and included the following complaints:
- “your total failure to make any disclosure - full or partial - in respect of the extent or the prospects of the repayment of the separate indebtedness of Fox Mandal & Co., Delhi and each of you as well”;
- “your continuing highly prejudicial and illegal efforts, despite our objections, to publicise Fox Mandal Little as one law firm”;
- “your widespread - publicity of SM [Som Mandal] as the Managing Partner of FoxMandal Little as if were a separate law firm which it clearly isn’t”;
- “your demand for payments out of Little’s profits and to deal with the disclosures made in the copy of the audited accounts of FM for the year ended March 31, 2008”;
- “the termination of the MOU dated May 19, 2006”.
That letter followed an increasing strain on the relationship between the firms, including Som Mandal allegedly ignoring requests by Little & Co partners to meet to explain why salary payments of Delhi fee-earners were late.
“We have sufficiently made it clear in our earlier mails that the public knowledge of the deteriorating financial position of FM-Delhi is gravely affecting the interest, goodwill and reputation of Little and is highly prejudicial to its interest,” said Little’s letter. “We have also clarified why FoxMandal Little should not be projected as a separate law firm with Little & Co., a part of it and why SM should stop projecting himself as the Managing Partner of FML.”
In early 2011 FoxMandal and Little & Co entered into formal arbitration in Mumbai under the MOU. Little’s lawyers are understood to have been Mumbai firm Federal & Rashmikant, while FoxMandal was represented by DH Law.
Little & Co partner Ajay Khatlawala told Legally India last week: “I won’t like to comment on that issue. The matters are pending before the appropriate forum.”
Som Mandal did not respond to phone calls today.
In May 2011 one of FoxMandal’s former partners, who left in the wake of the 2009 cash crunch, sued FoxMandal for recovery of allegedly unpaid dues.
Little & Co is one of India’s oldest law firms, established in 1846 in Mumbai as main legal adviser to the East India Company, while FoxMandal was founded in Kolkata in 1896.