Pallet-Track is preparing legal action against the new owner of Canute Haulage Group over a £50,000 debt, MT can reveal.

Canute was a Pallet-Track member and covered multiple postcodes including CA, LA, TD, DG and RM.

However, Pallet-Track is understood to have served Canute its notice in March, ahead of its controversial pre-pack, over concerns regarding the service the member was delivering and poor communication.

Canute was working its notice when it made its move to stave off insolvency via a pre-pack administration in May. This has left Pallet-Track an unsecured creditor of the old business, which is in administration, £56,000 out of pocket, according to Pallet-Track MD Nigel Parkes.

"The pre-pack happened over a weekend," Parkes told MT."There was the switch to the new owner Almtone and on Monday it kept trading. It took us about two weeks to get official confirmation that it had been a pre-pack, rather than a sale as a going concern."

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Parkes said that while Pallet-Track could have got rid of Canute as the point of administration as the new business was not contracted to the network, he chose to instigate a gentleman's agreement and gave the operator two weeks to get its house in order.

The Pallet-Track boss said that he was conscious Canute employed more than 800 people and at the point of the agreement did not want to add to a precarious situation that might affect them.

In the time it traded as a Pallet-Track member, Canute’s new owner Almtone racked up another £50,000 debt to the business.

Parkes said that despite chasing this payment he has had no success, and contacted his lawyer on 6 August to begin legal proceedings.

Three new members have been recruited to cover the postcodes previously operated by Canute: J Dickinson Transport covers CA, TD, and DG; Cannons Transport the LA region; and TW Road Haulage, which covers a section of RM.

Speaking to MT last month Canute sales director David Emslie confirmed the departure.  “On the Pallet-Track situation, the old Canute business was a member of the network and The Almtone acquisition did nullify our previous agreements with Pallet-Track.

“Canute have now left the Pallet-Track network and for the time being are operating an independent solution for our customers by utilising our 14 UK depots. Clearly the benefits of being a pallet network member are not lost on us and we are currently in discussions with a number of networks to help decide upon our future strategy.”