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Law Society intervenes in Supreme Court case to protect members' rights to litigation costs

26 January 2018

The Law Society has been granted permission to intervene in the Supreme Court case of Haven Insurance Company Limited v Gavin Edmondson Solicitors Ltd.

The case considers the issue of a defendant insurer that had developed a practice of contacting injured parties directly after they had been notified of a claim by solicitors via the Road Traffic Accident Claims Portal. The insurer settled claims directly with claimants on terms which did not provide for their solicitors to be paid their fixed costs under the RTA Protocol.

In 2015 the Court of Appeal concluded that, as the solicitors were operating under a Conditional Fee Agreement-lite (CFA-lite), which removed the clients’ liability to pay any costs beyond what could be recovered from the insurer, they could not establish a lien for their costs against their client in the usual way – a lien being the right to keep possession of property belonging to another person until their debt is discharged. However, the court held that the solicitors were entitled to protection in equity on the grounds of equitable interference. It ordered Haven to pay the fixed costs under the Portal to the solicitors.

The defendant insurer, Haven, successfully sought permission to appeal to the Supreme Court. The Society is intervening because we believe the case has important implications for solicitors. We are asking the Supreme Court to confirm that the equitable lien can be applied to protect solicitors’ rights to their costs in modern litigation; particularly in fixed costs regimes where the indemnity principle does not apply.