Allen & Overy (A&O) and Cadwalader Wickersham & Taft are to next week face a High Court ruling over the two firms’ controversial decision to advise both creditors and the administrators of failed power group TXU Europe.

The application for direction is due to be heard on Tuesday (15 March) on the legality of both firms’ status as advisers to KPMG, one of the joint administrators of TXU, while A&O is also advising a group of creditor banks and Cadwaladers is advising the company’s bondholders.