Walker Greenbank auditors in court today
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Your support makes all the difference.A LONG-RUNNING legal battle is due to come to the High Court today with Walker Greenbank, the mini-conglomerate founded by Sir Anthony Jolliffe, one-time Lord Mayor of London, opening its case against Ernst & Young, the accountants.
Walker Greenbank, now under a different management team headed by Charles Wightman, chief executive, is suing the Big Six firm and its co-defendants, William Carr and his son, Alan, for about pounds 15m in damages and interest in connection with the pounds 3.5m acquisition of Alkar, a shopfitting company, in January 1987. Ernst & Young is also facing, with Price Waterhouse, an dollars 8bn (pounds 4.5bn) claim over the collapse of Bank of Credit and Commerce International.
Walker's claim against the Carrs, previous owners of Alkar, alleges misrepresentation, negligence and fraud, and stems from allegations that debtors and sales had been overstated to the point of insolvency. The Carrs were on an earn-out arrangement worth up to pounds 11m and had already received pounds 2.6m in two tranches of shares. The suit against Ernst & Young alleges that the Birmingham office of Arthur Young, its predecessor firm and Walker's auditor until January 1989, was negligent in failing to spot alleged irregularities in the financial records.
Ernst & Young is understood to have accepted that there were problems with the audit and the report on Alkar. However, its experts have been unable to agree with those employed by Walker on the scale of damages.
The Carrs are believed to be counter-claiming for pounds 7.6m covering loss of pension, pay, dividends and damages.
In 1989, the group revealed that several million pounds would have to be written off over the deal. Arthur Young resigned as auditor.
Walker Greenbank was founded in 1986 by the linking of two engineering companies, C&W Walker and Greenbank, by Sir Anthony and his partner, John Tither. Their aim was to build a mini-conglomerate, and Alkar was one of a number of acquisitions made over the next few years.
Prior to this, Sir Anthony ran an accountancy firm with the late Sir Kenneth Cork, the noted insolvency specialist and another former Lord Mayor of London.
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