Indemnity insurance

The Court of Appeal has overturned a ruling that gave a national law firm summary judgment in a case alleging that its negligence had caused a company to lose a £4m intellectual property licensing deal with a global engineering giant.

Research by the Solicitors Regulation Authority to support its plans to reform indemnity insurance has “clear limitations”, ignoring the recent increase in claims related to cybercrime among other failures, the Law Society has claimed as it geared up for the next round of its battle with the regulator over the reforms.

A highly experienced solicitor who breached the Money Laundering Regulations 2007 in a property transaction that led to a £500,000 fraud did not act dishonestly, the High Court has ruled. As a result, it dismissed a subrogated claim brought by the insurers of London law firm Pemberton Greenish to make her cover what they had to pay out.

The Financial Services Compensation Scheme (FSCS) has had to increase its provision for general insurance claims by around £45m for the next financial year, because of the failures of Enterprise Insurance and Gable Insurance AG, it has emerged, while it is still paying out for other insurers that used to back solicitors.

A solicitor whose law firm partner has gone to jail for four years for mortgage fraud has lost her bid to have the £4.65m losses being sought from her covered by the firm’s professional indemnity insurer, even though she was not alleged to have had any personal involvement in the frauds.

A judge has ruled that the advice lawyers gave in ancillary relief proceedings was negligent and that if the claimant had been properly advised, he would have settled on better terms. But he dismissed an allegation that the solicitor had fabricated her file notes.

The professional indemnity insurer of an insolvent law firm is not required to repay the £581,000 a disbursement funder lost due to the firm’s breach of contract, the Supreme Court has ruled. The justices overturned the Court of Appeal by 4-1.

Solicitors’ professional indemnity insurers paid out around £2bn due to negligence claims in the 10 years to 2014, startling new figures released yesterday by the Solicitors Regulation Authority revealed. The regulator said that around 142,000 claims were made in that decade, one in five of which was successful.

The High Court has thrown out a £5m fraud and conspiracy claim against a newly qualified solicitor and experienced legal executive who acted for a Docklands developer. Mr Justice Mann said the pair had suffered “years of anxiety” as a result of the claim, “culminating in a trial which they should not have had”.

A finance company for law firms has announced that it wants to delist from the stock exchange as it awaits a crucial Supreme Court ruling. It is the first of two Supreme Court cases that focus on interpretation of the minimum terms and conditions for solicitors’ insurance, the second of which was before the justices yesterday.

In what is being hailed as a significant victory for conveyancers, a law firm and estate agency have defeated a claim brought against them after it turned out that the seller they acted for was a fraudster. The fraud only came to light when the real owner walked past his property and saw builders ripping out the kitchen.

Law firms that were insured by the now insolvent Enterprise Insurance have until today to arrange alternative cover. The Solicitors Regulation Authority said on Friday that around two-thirds of the 43 firms that were with the Gibraltar-based insurer have already secured alternative cover.

The Legal Services Board has shied away from recommending a single solution which all the legal regulators should follow on indemnity insurance. The LSB instead called on the regulators to work more closely together on the issue.

Leading group action law firm Leigh Day has been found guilty of professional negligence after 6,624 of the claimants it represented in the high-profile Trafigura case were not paid their share of the £30m settlement. Leigh Day said it tried its “damnedest” to ensure everyone received their payments.

The High Court has summarily dismissed a professional negligence claim brought by a hotel company against Midlands firm Wright Hassall and a barrister, Max Mallin. The case involved the conversion of a Victorian office building in Manchester into a four-star hotel.