Leeds-based Front Row Legal has won an appeal on behalf of a Huddersfield employment agency in its dispute with a former director who was found liable for more than £650,000 last year.
Court of Appeal Lord Justices McCombe, Bean and Lewison dismissed former Keystone Healthcare director Colin Parr’s appeal during a hearing that was streamed live on 9 July. The reasoning for the decision has been published.
Business law specialist Front Row Legal acted for Keystone in its claims against Parr, who was a director and shareholder in the employment agency, which supplies staff to the NHS, until 2014.
Keystone co-director Richard Ward agreed to pay Parr £1.2 million for his 38% shareholding when he left the firm.
Parr then set up a new company in direct competition with Keystone, doing so in breach of his employment contract.
A little over 18 months later, Keystone discovered that its payroll system had been compromised months prior to the departure of Parr, and a series of bogus payments made to accounts controlled by him and IT consultant Mark Reynard. The misappropriated funds ran to more than £128,000.
Keystone immediately had the accounts frozen and launched legal proceedings. In February 2018, Parr was ordered to repay the diverted funds.
Then in June, High Court Judge Stephen Davies ruled that Parr had been in breach of his duties as a director of Keystone and therefore must pay back the difference between the amount he received for his shares and the 50% discount that would have applied, under the applicable regulations, had the company been aware of the bogus payments. This overpayment amounted to £650.612.04.
Parr unsuccessfully appealed against this second ruling. Front Row Legal managing partner Richard Cramer (pictured) said: “We are delighted at the outcome of today’s Court of Appeal case. Before our barrister had made even a single submission to the court, the appellant Colin Parr had his appeal dismissed.”
Cramer continued: “This effectively this brings an end to the two years of litigation and the dismissal of the appeal clearly shows that the result achieved by Keystone Healthcare 12 months ago at Manchester High Court was emphatic. It now means that Mr Parr, in addition to having to pay costs, is required to reimburse his former company with the significant sum overpaid for his shareholding, together with interest.”
He added: “The legal team that worked on this matter, including Partner Robina Hussein and our barrister Martin Budworth, have achieved an outstanding result for Keystone Healthcare due to their hard work and dedication.”