Ex-BHS directors slapped with massive bill over collapse of chain

Two former directors of failed budget department store retailer BHS have been ordered by a court to pay at least £18 million to creditors over their role in its collapse.

Lennart Henningson and Dominic Chandler have been found liable for wrongful trading, misfeasance trading and misfeasance over their management of the UK chain that closed eight years ago with the loss of 11,000 jobs.

BHS fell into administration with £1 billion of trading liabilities and £571 million in pension debts in 2016 after Sir Philip Green was criticised for selling the ailing business to Dominic Chappell for £1 in March 2015.

Henningson and Chandler worked for Chappell’s company Retail Acquisitions and the judge ruled they’d breached their corporate duties by continuing to trade despite knowing there was no reasonable chance that BHS could avoid insolvency.

Each must pay £6.5 million for wrongful trading and £5.6 million between them for the charges of misfeasance. They could also face additional multi-million pound fines, alongside Chappell who himself faces claims from creditors.

FRP Advisory, the company acting as liquidator to BHS, brought the case against the directors on behalf of creditors owed money following the retailer’s collapse. These include the government’s Pension Protection Fund.

Claims faced by Dominic Chappell will be considered at a separate hearing this month. The disgraced former entrepreneur was jailed for six years in 2020 for tax evasion.

FRP said it had been working to claw back money owed to creditors and made “very substantial recoveries” since 2016.

The BHS brand does still trade online selling mostly homewares.