Halliwells of Manchester has become the first big UK legal practice to fall victim to the financial crisis and could become the biggest ever to go out of business, says a report in The Times.

Halliwells, which had turnover of £78m last year, is to be dissolved. Halliwells, which was founded in 1975 and has 115 partners and about 700 staff across four offices, revealed said it had informed the courts of its intention to appoint an administrator. It said that high property costs and declining profitability had left it unable to cover operating costs.

Its biggest creditor is the Royal Bank of Scotland, which is owed close to £20m. Halliwells said that its underlying business - it is best-known for its insurance litigation practice - remained healthy and had attracted interest from a number of potential buyers. The report notes the firm had been one of the legal market's highest fliers for much of the past decade.