Reynolds Colman Bradley LLP is a specialist law firm with expertise in managing and resolving claims in the Insurance, Commercial and Construction sectors.

PII News 20 October 2016

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Reynolds Colman Bradley News – Thursday 20 October 2016

High Court dismisses £5.2m fraud and conspiracy claim against solicitors

Mortgage Agency Services Number One Ltd (t/a Britannia Commercial Lending) -v- Cripps Harries LLP [2016] EWHC 2483 (Ch)

Mr Justice Mann, sitting in the High Court, recently dismissed this claim brought by the lender against a firm of solicitors claiming damages for fraud and conspiracy. The lender failed to establish that the NQ solicitor and experienced Legal Executive had made several misrepresentations in the course of the conveyancing or that they had conspired to hide information concerning the financial position of their client.

The Claimant Lender alleged that the Defendant’s property developer client was only lent the £11.4m on account of misleading information provided by the Defendant’s employees. The property developer, who was already in receivership at the point of the loan, defaulted on its repayments and the Lender sought damages of £5.2m.

It was held that the Defendant firm had not told intentional lies and that there had been no intention to mislead or cheat the Claimant. The court found no conspiracy to conceal the existence of the receivership either.

http://www.bailii.org/ew/cases/EWHC/Ch/2016/2483.html [Full Judgment Transcript]

http://www.legalfutures.co.uk/latest-news/high-court-throws-5m-fraud-claim-solicitor-legal-executive

http://www.lawgazette.co.uk/law/lawyers-who-suffered-years-of-anxiety-cleared-of-fraud-allegations/5058277.fullarticle

Government has no intention to remove statutory “Consent” defence from solicitors reporting suspected money laundering

The Government’s “Action Plan for Anti-Money Laundering and Counter-Terrorist Finance” will not result in the removal of the statutory “consent” defence, as was feared back in April 2016, which currently exists for solicitors reporting suspected money laundering. Rather, they will continue to explore ways in which the consent regime might be prevented from being misused.

http://www.lawgazette.co.uk/law/government-to-keep-aml-consent-defence/5058367.article

Compulsory mediation for low-value disputes could help save thousands in costs

Commercial litigator and mediator Stephen Walker, at a panel event on mediation, called for mediation to become compulsory in low-value disputes. This has been backed by fellow lawyers and mediators and even Lord Justice Briggs who acknowledged that mediation was working well for small claims up to £10,000 and who expects that online dispute resolution will take centre stage in the coming years as part of the civil court re-structuring.

https://www.solicitorsjournal.com/news/201610/compulsory-mediation-can-work-low-value-disputes-say-lawyers

PIB buy QPI Legal

PIB is using investment from Private Equity firm Carlyle to accelerate growth through acquisitions. Since the investment in December 2015, PIB have acquisitioned Cooke & Mason; Fish Insurance; and Channel Insurance Brokers. Their latest and fourth acquisition is QPI Legal, a Northampton based broker and risk management company specialising in Professional Indemnity Insurance for the Legal profession.

http://www.insuranceage.co.uk/insurance-age/news/2474583/pib-buys-qpi-legal

http://www.insurancetimes.co.uk/pib-buys-professional-indemnity-broker/1420043.article

Three solicitors have been struck off for failing to prevent fraudsters infiltrating their conveyancing firm

Austins Law, a conveyancing law firm, cost the compensation fund almost £3m.

Following a complaint from fellow law firm, G & Co, regarding its client having tried to enter a property for which they had paid £435,000 only to find the occupants blissfully unaware and still very much living there, the SRA had intervened in the running of Austins. During early interviews, a bookkeeper of Austins posed as a solicitor confirming that he had met the seller in the transaction and checked the original documents.

Two of the partners who had been hired in 2013 had no experience of conveyancing work.

Client funds were improperly used.

All 3 partners were struck off and ordered to pay £75,000 in joint costs with the founding partner paying an extra £10,000.

http://www.lawgazette.co.uk/news/three-struck-off-after-fraudsters-infiltrate-law-firm/5058406.article

http://www.telegraph.co.uk/news/10641419/Missing-millions-and-the-vanishing-lawyer.html

http://www.rcbllp.com

PII News 13 October 2016

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PII News – Thursday 13 October 2016

New decision in growing PII concern relating to Imposter Fraud

P&P Properties -v- (1) Owen White & Catlin and (2) Crownvent Ltd t/a Winkworth [2016] EWHC Civ 2276 (Ch)

A fraudster acquired the identity of a homeowner and sold their West London property disappearing with the £1 million proceeds and leaving the buyer out of pocket and with no new home. The buyer brought a case against the fraudster’s solicitors and estate agents for breach of warranty of authority, breach of trust and negligence. The case has been dismissed but with permission to appeal.

Robin Dicker QC ruled in the High Court that while solicitors’ checks were designed to reduce the risk of fraud, they could not reasonably be thought to eliminate it. Nor did the Defendants, instructed by the fraudster, owe a duty to the buyer to verify the seller’s identity.

http://www.legalfutures.co.uk/latest-news/law-firm-duped-imposter-successfully-defends-claim-1m-property-fraud

http://1chancerylane.com/latest-news/new-imposter-fraud-decision/

Jackson encourages alternative methods to Standard Disclosure

Speaking at the Law Society’s Commercial Litigation Conference 2016, Lord Justice Jackson has said that lawyers and judges should be more proactive and “act against their own interests” when it came to Disclosure and that they should limit it for the public’s benefit. He said that lawyers must consider other newer forms of disclosure rather than automatically resorting to Standard Disclosure. Since 2013, a number of technology assisted methods have been introduced which help reduce costs.

He went on to highlight CPR 31.5, a rule introduced in April 2013 to encourage different forms of disclosure.

https://www.solicitorsjournal.com/news/201610/jackson-tells-lawyers-and-judges-be-proactive-disclosure

http://www.lawgazette.co.uk/news/jackson-urges-culture-change-on-profitable-disclosure/5058232.fullarticle

Lord Borwick calls for post-Brexit solution to address the costly construction issue of Great Crested Newts

During a debate in the House of Lords about the shortage of affordable housing in the UK, Conservative Peer and property developer, Lord Borwick, alleged that Great Crested Newts were being introduced to proposed building sites by protesters in a bid to scupper the plans on environmental grounds. He requested that on the basis that the species is endangered in the EU but not in the UK there should be consideration given to these issues with a “post-Brexit eye”.

Great Crested Newts are protected by UK and EU laws making it illegal to catch, possess or handle them without a licence. It is also prohibited to cause harm or disrupt their habitat in any way. In the past, £1m has been spent over a year in removing the newts from a proposed building site.

http://www.telegraph.co.uk/news/2016/10/12/rare-newts-planted-at-development-sites-to-stop-the-bulldozers/

http://www.thetimes.co.uk/article/have-i-got-newts-for-you-nimbys-secret-weapon-f3dv03qv7

The FCA reports 2.6% reduction in new complaints

Between January and June 2016, the Financial Conduct Authority has reported that new complaints have reduced by 2.6% and financial redress has reduced by 1% compared to the previous 6 months. The total number of complaints for the 6 month period amounted to 2.05 million and the total amount of redress paid was calculated at £1.96 billion.

https://www.fca.org.uk/news/press-releases/total-number-complaints-continues-fall

http://www.financialreporter.co.uk/finance-news/financial-services-complaints-dr0p-26.html

Fewer than half of small companies have adequate cyber insurance cover

The FT has reported that in the last year a third of small businesses have suffered a cyber security breach. While fewer than half of small companies have cyber insurance cover, over 60% do have cyber incident response plans.

Beazley specialist insurers have predicted a 400% increase in ransomware breaches globally over the next year. Ransomware breaches involve hackers gaining access to networks, encrypting the company data and then demanding a ransom.

https://www.ft.com/content/e58d969a-6f63-11e6-a0c9-1365ce54b926

http://tech.co/should-small-businesses-be-paying-more-attention-to-cyber-security-2016-10

http://www.rcbllp.com

PII News 15 September 2016

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Reynolds Colman Bradley LLP News – 15 September 2016

Law Firm Comparison Sites should be given access to firms’ claims history

Paul Philip, Chief Executive of the Solicitors Regulation Authority, has said that the SRA will seek a longer-term strategic solution to help consumers choose solicitors. This looks set to include the publishing of firms’ records of enforcement action; practice conditions; complaints; and claims data. He avers that such information should not be available to only the legal sector but also it should be accessible by “all data re-publishers” including comparison sites.

http://www.lawgazette.co.uk/news/comparison-sites-need-access-to-firms-past-mistakes-sra-chief/5057587.article

http://www.legalfutures.co.uk/latest-news/sra-considers-publishing-firms-complaints-claims-recorsds-quality-indicators

Solicitors’ premiums up to 20% lower than 2015 figures

With October 2016 renewals fast approaching, law firms are finding that they are being offered premiums up to 20% lower than 2015 premiums.

Unrated insurers are being priced out of the market.

http://www.lawgazette.co.uk/news/insurance-premiums-down-by-up-to-20/5057548.article

Over 1,000 new law firms (including ABSs) for 2016

It has been predicted that over 1,000 new law firms will be authorised by the SRA during 2016. A 30% increase on previous years.

The SRA have authorised 612 entities between 1 January and 31 July 2016, including 94 Alternative Business Structures.

http://www.lawgazette.co.uk/practice/new-legal-firms-set-to-top-1000-this-year/5057544.article

BPE Solicitors penalised for their involvement in SDLT Avoidance Scheme

BPE Solicitors acted in 65 conveyancing matters up to May 2012 where they assisted the clients in avoiding paying £1.3m Stamp Duty Land Tax. Clients were charged an additional £390 for the privilege.

57 of the schemes were provided by Cornerstone International Advisory Services Limited, with two other schemes provided to clients by Inventive Tax Strategies and iTax Consultancy.

The firm paid the SRA a fine of £2,000 and £7,500 in prosecution costs.

http://www.lawgazette.co.uk/practice/firm-helped-clients-avoid-13m-stamp-duty-payments/5057640.article

http://www.legalfutures.co.uk/latest-news/firm-admits-misconduct-involvement-sdlt-avoidance-schemes

Law Society dismisses claim that solicitors facilitate insurance fraud

The Law Society has hit back at the Association of British Insurers following their claim that solicitors have facilitated insurance fraud.

ABI’s director of general insurance policy, James Dalton, stated on BBC Radio 4’s Today programme that “as the industry has got better at cracking down on fraudulent whiplash claims and motor claims, claimants and their lawyers have moved their attention to liability claims”. He said that as a result of this, there had been a 36% increase in fraudulent slip and trip claims over the last year.

Law Society Chief Executive, Catherine Dixon, responded by saying that she not accept that solicitors were actually facilitating fraudulent claims. It is her view that solicitors are helping to support people who have been harmed through no fault of their own to secure access to justice and receive the compensation they are entitled to in law to help them recover and rebuild their lives. She encouraged the ABI to work ever more closely with solicitors to identify and eradicate fraud.

There is also concern surrounding the removal of solicitors being banned from cold-calling in the SRA Handbook. APIL president, Neil Sugarman, has called for legislation for those solicitors who would consider cold-calling in the future.

http://www.legalfutures.co.uk/latest-news/law-society-rejects-abi-claim-solicitors-facilitate-insurance-fraud-amid-concern-cold-calling-ban-go

http://www.rcbllp.com

PII News 8 September 2016

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Reynolds Colman Bradley LLP News – 8 September 2016

Coutts face being sued as promoters of ineffective tax avoidance scheme

Ingenious Games LLP -v- Revenue & Customs Commissioners [2016] UKFTT 521 (TC) (FTT (Tax))

HMRC’s fight against tax avoidance hits another run of film partnerships. Following the long-awaited decision in the first-tier Tribunal, only a proportion of the partnership schemes created by Ingenious Games LLP were found to be liable for tax relief.

As a result, around 220 clients of private bank, Coutts, have filed a lawsuit against the Royal Bank of Scotland owned bank seeking at least £100m for back-taxes and interest that they now owe having entered into these schemes allegedly following the advice of Coutts.

There is strong potential for other companies / advisors to be sued by out-of-pocket clients over advice given in relation to this scheme. The scheme attracted almost 1,300 investors.

http://www.ft.com/cms/s/0/cecd9a38-7510-11e6-b60a-de4532d5ea35.html#axzz4JfdLxELD

SRA agrees that the market is not functioning effectively and considers making PII claims data available as indicators of quality

The recently published Competition and Markets Authority’s interim report on the legal services market has been agreed with by the SRA.

The SRA has published its response saying that they agree that the legal services market is not functioning as well as it should be. In particular, the SRA states that it supports these three aims of the proposed remedies:

Improving price and service transparency
Addressing barriers to comparison and search
Improving consumer information and awareness of providers.

As part of this, they will consider propositions of publishing complaints data and professional indemnity insurance claims data in order to provide an accessible indicator of quality. With regards to PII in particular, the SRA averred that over the period 2004-2014 there were 142,000 indemnity insurance claims notified by solicitors’ firms. To date, roughly one in five have resulted in payments, worth a total of £1.6 billion.

https://assets.publishing.service.gov.uk/media/577f76daed915d622c0000ef/legal-services-market-study-interim-report.pdf

http://www.sra.org.uk/sra/consultations/consultation-responses/cma-interim-report.page

http://www.legalfutures.co.uk/latest-news/sra-considers-publishing-firms-complaints-claims-recorsds-quality-indicators

The Attorney General and the Prime Minister call for more corporate responsibility

The Attorney General, Jeremy Wright, and the Prime Minister, Theresa May, look to stand firm in addressing the threat of business crime.

Mr Wright is advocating the introduction of a “culture of corporate responsibility” stating that where business crimes, such as tax avoidance and money laundering, are uncovered both the business and individuals should be held accountable.

Mrs May proposes to crack down particularly on multinational companies and promises new proposals for tackling corporate behaviour later in 2016.

http://www.lawgazette.co.uk/law/law-chief-calls-for-culture-of-responsibility-on-business-crime/5057407.article

https://www.theguardian.com/uk-news/2016/sep/05/theresa-may-tells-g20-she-plans-to-tackle-bad-corporate-behaviour

https://www.gov.uk/government/speeches/g20-summit-china-prime-ministers-press-conference-5-september-2016

https://www.gov.uk/government/speeches/attorney-general-jeremy-wright-speech-to-the-cambridge-symposium-on-economic-crime

The SSP SaaS saga struggles through second week

Brokers across the Insurance industry see another week through with the SSP SaaS Platform outage remaining unfixed. The outage occurred on 26 August 2016 when one of SSP Worldwide’s datacentres had a power outage. They then suffered a setback in their restoration operations following a hardware failure on 1 September 2016.

SSP aver that 40% of UK brokers use this system to help track renewals and source quotes.

http://www.insuranceage.co.uk/insurance-age/news/2469965/brokers-remain-offline-11-days-after-ssp-outage

http://www.computerweekly.com/news/450303913/Insurance-brokers-count-cost-of-lost-business-as-SSP-SaaS-platform-outage-enters-second-week

http://www.insurancetimes.co.uk/forty-brokers-now-live-on-ssp/1419616.article

http://www.rcbllp.com

PII News 1 September 2016

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Reynolds Colman Bradley LLP News – 1 September 2016

Mid-market law firms are being urged to merge with accountancy practices

Arden Partners, stockbrokers, recently published a report which warns mid-market law firms that they must look to merge with accountancy firms to form multi-disciplinary practices (alternative business structures) if they are to have any hope of surviving against the expanding Big Four accountancy firms (PwC, Deloitte, EY, KPMG) and Magic Circle Law Firms.

The Big 4 are expanding the services into more legal practices previously reserved for lawyers. In addition, Magic Circle law firms are taking on more and more nearshoring and contract work which previously had been the bread and butter of the mid-size firms.

http://www.thelawyer.com/mid-market-firms-merge-diversify-fail/

http://www.arden-partners.com/media/1455/strategic-research-on-mdp-the-solution-for-middle-market-professional-services.pdf (details of how to obtain a copy of the report)

Herbert Smith Freehills launches cybersecurity hotline

Herbert Smith Freehills is launching an international cybersecurity hotline following the world wide growing concerns in relation to cybercrime. The hope is that they will be able to deal with clients’ issues of different sizes in a timely fashion without needing to set up a retainer each time. HSF has found that many clients have become acutely aware of cybersecurity from a regulatory and compliance perspective as a result of significant fines coming from regulators. Penalties look to increase when a new EU Regulation comes into force in 2018, which is likely to be before Brexit occurs.

http://www.lawgazette.co.uk/practice/city-firm-sets-up-hotline-to-address-client-fears-over-cybersecurity/5057296.article

http://www.herbertsmithfreehills.com/practice-areas/cyber-security/cyber-security-hotline

The City of London Police are taking steps to hire law firms as part of the criminal justice process

The City of London Police are taking steps to hiring law firms to help recover/seize assets by using civil litigation against convicted and suspected criminals. A two-year pilot scheme will test a panel management strategy. They are currently not accepting bids from law firms, but are looking for panel management companies to take part over the next two years.

http://www.lawgazette.co.uk/news/city-police-look-for-panel-managers/5057266.article

https://www.theguardian.com/uk-news/2016/aug/14/police-to-hire-law-firms-to-tackle-cyber-criminals-in-radical-pilot-project

Enterprise’s negative impact continues to affect law firms

Following the collapse of Enterprise insurers last month, more than 10 law firms have been put on notice by the SRA and now face closure after failing to secure new professional indemnity policies.

43 firms had PII with Enterprise and were given 28 days from the date of insolvency (until 22 August 2016) to arrange alternative cover.

http://www.lawgazette.co.uk/practice/enterprise-firms-unable-to-secure-new-pii-put-on-notice/5057231.article

http://www.insurancetimes.co.uk/solicitors-still-seeking-pi-cover-after-enterprise-collapse/1419501.article

Bluefin’s EBITDA 2015 is down but overall growth and turnover is up!

Bluefin’s turnover for 2015 hit £121m which was an increase of £3.6m on 2014. Their EBITDA was down £3.3m to £20.5m. They continue to focus on growth, mergers and acquisitions.

http://www.intelligentinsurer.com/news/m-a-and-specialist-lines-drive-bluefin-s-growth-in-2015-9429

http://www.rcbllp.com

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Reynolds Colman Bradley News – Thursday 25 August 2016

Judgments against businesses fall following 2015 increase in court fees

Figures show that the number of county court judgments against businesses in England and Wales in the first half of 2016 represents a 19% fall compared to the same period of 2015.

The value of such claims has also decreased by about 12%.

Court fees were increased in 2015 for civil money claims.

http://www.solicitorsjournal.com/news/commercial/company/27382/small-businesses-are-being-%E2%80%98priced-out-court%E2%80%99

http://www.lawgazette.co.uk/law/court-fee-hikes-behind-fall-in-business-judgments/5057022.fullarticle

HMRC puts more pressure on tax evaders

HMRC is planning to impose even tougher penalties on those who are evading tax by way of offshore accounts and owe outstanding tax.

It has been suggested that such penalties could be three times the amount of tax being evaded. In addition, the penalties will seek to increase the risk of criminal charges.

This comes at a time when HMRC is preparing to receive data on those with offshore accounts in crown dependencies and overseas territories in October 2016. This comes a year before the Common Reporting Standard comes into force which will facilitate HMRC’s access to data from across the globe.

https://www.gov.uk/government/news/tough-new-sanctions-announced-for-offshore-tax-evaders

http://economia.icaew.com/news/august-2016/hmrc-wants-swingeing-new-sanctions-to-combat-tax-evasion

Litigant in person ordered to pay costs of £100,000 for “a farrago of nonsense”

Re A (A Patient) In the matter of applications by and against Desmond Maurice Fitzgerald [2016] EWCOP 38

Litigant in person, Desmond Fitzgerald, has been ordered to pay costs on an indemnity basis of £100,000.

Mr Fitzgerald had made a committal application against Frances Hughes, Private Client partner at Hughes Fowler Carruthers. The Judge labelled his application as “a farrago of nonsense” and averred that the allegations were “scurrilous, fatuous, and should never have been made”.

There is a lot of pressure on Judges to allow LiPs a chance but they often highlight to the LiPs the risk of pursuing unreasonable litigation and the likely escalation of costs associated with litigation. Hughes suggested that a better system was needed to deal with such cases, especially following the withdrawal of legal aid.

http://www.solicitorsjournal.com/news/litigation/costs/27384/lip-slapped-%C2%A3100k-costs-bill-%E2%80%98farrago-nonsense%E2%80%99-application

Law firm sues Lloyds Bank for stolen Client monies resulting in alleged losses of more than £2m

A law firm is suing Lloyds Bank over claims it failed to protect its client bank account from fraud, leading it to suffer losses of more than £2m.

https://www.thelawyer.com/law-firm-sues-lloyds-bank-stolen-client-funds/?cmpid=dnews_2568174

Court of Appeal threshold is to remain the same

The government has decided not to raise the threshold for permission to take case to the Court of Appeal as part of the package of delay reducing reforms. The proposal was that the threshold should be increased from ‘a real prospect of success’ to ‘a substantial prospect of success’.

The Civil Procedure Rules Committee consulted earlier this year on ways to reduce the pressures faced by the civil division of the Court of Appeal following a 59% increase in their work over the last 5 years.

http://www.lawgazette.co.uk/law/court-of-appeal-threshold-to-remain-unchanged/5057226.article

68% of firms are satisfied with the the new licensed conveyancers’ Professional Indemnity Insurance

The Council for Licensed Conveyancers has published a survey which shows that 68% of firms are satisfied with the new arrangements for licensed conveyancers’ professional indemnity insurance. Almost 25% were ‘Dissatisfied”, with the majority of these saying that they found the new process more difficult.

The new arrangement sees them move away from a master policy scheme to open market. They also enjoy free automatic run-off-cover.

One firm commented that they had saved £38,000 under the new scheme.

http://www.legalfutures.co.uk/latest-news/make-solicitor-insanely-jealous-offer-competitor-free-run-off-cover

http://www.rcbllp.com

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Reynolds Colman Bradley LLP – News – 28 July 2016

ICAEW applies to regulate more reserved legal activities

The ICAEW has submitted an application to the Legal Services Board to become an approved regulator and licensing authority for five more reserved legal activities in relation to tax work. On top of already being an approved regulator for probate, it is now seeking to also include the following:

– Conduct of litigation

– Rights of audience

– Reserved instrument activities (the legal side of conveyancing)

– Notarial services

– Administration of Oaths (one part of Probate which cannot currently be undertaken by accountants)

http://www.icaew.com/en/about-icaew/news/press-release-archive/2016-press-releases/icaew-applies-to-regulate-further-reserved-legal-services

http://www.legalfutures.co.uk/latest-news/first-probate-now-tax-work-accountants-set-go-head-head-solicitors

The SRA publishes its risk outlook report for 2016-2017

The SRA’s Risk Outlook Report 2016-17 outlines the following:

– The most common types of complaints to the Legal Ombudsman are failure to follow instructions, failure to advise, excessive costs, lack of costs information, and delay.

– The areas of law with the highest number of complaints to the Legal Ombudsman are residential property, family law, personal injury, and wills and probate.

– Reports of bogus firms have doubled since 2012 to almost 700 per year. In half of these cases, the SRA avers that criminals have been targeting existing law firms and copied their identity.

– 25% of firms have been targeted by cyber criminals, with 10% resulting in money actually being stolen.

https://www.sra.org.uk/documents/solicitors/freedom-in-practice/risk-outlook-2016-2017.pdf

https://www.sra.org.uk/sra/news/press/risk-outlook-launch-2016.page

Lord Justice Briggs makes recommendations for new online court

Court of Appeal Judge, Lord Justice Briggs, has made recommendations in his final report for a new online court which would deal with all monetary claims up to £25,000. Lawyers have already come forward to express their concerns with this proposal. The online court would require minimal input from lawyers. The fear is that it may exclude people’s ability to access legal advice and potentially result in a system of two-tier justice.

https://www.judiciary.gov.uk/wp-content/uploads/2016/07/civil-courts-structure-review-final-report-jul-16.pdf

https://www.judiciary.gov.uk/civil-courts-structure-review/civil-courts-structure-review-ccsr-final-report-published/civil-courts-structure-review-final-report-press-notice

http://www.lawgazette.co.uk/law/briggs-online-court-needs-minimal-assistance-from-lawyers/5056850.article

Law Society publishes practice note on electronic signatures in commercial contracts

The Law Society has published a practice note providing guidance for parties looking to execute commercial contracts by using electronic signatures. E-signatures look to become a popular method in other legal areas too.

http://www.lawsociety.org.uk/support-services/advice/practice-notes/execution-of-a-document-using-an-electronic-signature

http://www.lawgazette.co.uk/practice/practice-note-gives-stamp-of-approval-to-digital-signatures/5056820.fullarticle

The last unrated Professional Indemnity insurer is to be wound up

Enterprise Insurance Company Plc has been ordered by the Gibraltar Financial Services Commission not to write any new business and has begun the process of winding up the company.

The last of the unrated PI Insurers is said to have become insolvent and unable to secure additional funding.

http://www.lawgazette.co.uk/practice/gibraltar-based-pii-insurer-heads-for-liquidation/5056823.article

The Supreme Court rules that fraud can lead to insurance settlements being set aside

Hayward (Respondent) v Zurich Insurance Company plc (Appellant) [2016] UKSC 48

The Supreme Court has ruled about evidence of fraud during an insurance claim which comes to the attention of the Insurers after settlement.

Lord Clarke, giving leading judgment, found that the settlement could be set aside and re-calculated.

http://www.bailii.org/uk/cases/UKSC/2016/48.html

http://ukscblog.com/new-judgment-hayward-v-zurich-insurance-company-plc-2016-uksc-48/

www.rcbllp.com

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Reynolds Colman Bradley LLP News – Thursday 21 July 2016

A collateral lie in an insurance claim should not have an effect on right to recovery

Versloot Dredging BV v HDI Gerling Industrie Versicherung AG [2016] UKSC 45 (SC)

The Supreme Court has ruled that if a Claimant has lied during the course of the case and that lie was not relevant to the case then the Insurer should pay up.

The claimant claimed around £2.7m after their ship’s engine room had flooded. The Insurer succeeded in dismissing the claim through the County Court and the Court of Appeal on account of the Claimant lying about the sounding of an alarm in order to strengthen their case, accelerate payment and take the focus off defects in the ship.

Ultimately, it was found that the lie was not relevant to the claim because the losses were caused by ‘peril of the seas’ i.e. bad weather rather than a fault of the vessel itself. It was found by 4 judges to 1 that collateral lies were immaterial to the Insured’s right to recover.

The one dissenting judge, Lord Mance, said that allowing lies will “distort the claims process by the time and cost involved in unveiling the fraud and attempting to ascertain its true implications”.

http://www.bbc.co.uk/news/business-36845617

http://www.lawgazette.co.uk/law/supreme-court-allows-insurance-claim-even-though-it-involved-a-lie/5056725.article

https://www.supremecourt.uk/cases/docs/uksc-2014-0252-judgment.pdf

A Part 36 offer was held to be a counter offer meaning that a previous offer was no longer open to acceptance

The Defendant law firm were being sued for Professional Negligence by the bank for damages in excess of £162,000.

In advance of the claim going to trial, the Claimant made a Part 36 offer. The Claimant then sent a letter saying that it was accepting the common law ‘Without Prejudice’ offer which had been made by the Defendant prior to the Part 36 offer. The latter Part 36 Offer was held to be a counter-offer and therefore resulted in the Defendant’s previous common law offer no longer being open for acceptance.

Mr Hochhauser QC, sitting as Judge, said that because in the case “one is dealing with an initial common law offer, the impact on it of any counter-offer has to be addressed by reference to common law principles”.

http://www.litigationfutures.com/uncategorized/high-court-part-36-offer-meant-party-could-not-accept-earlier-without-prejudice-offer

Signing blank court documents is held to be unacceptable and results in fine for immigration solicitor

An immigration solicitor signed a statement of truth on a blank claim form on the basis that quite often there is an element of urgency in immigration cases and would rather not risk being unable to file the documents in time. Unfortunately, in this matter, it was accidentally passed to her former client who had collected the file because they could not afford to continue with the instruction of the solicitor and thereafter used the document to launch a judicial review following rejections by the First-Tier and Upper Tribunals. The solicitor had not been removed from the court record.

Sir Brian Leveson, unhappy with the conduct of the case, referred the solicitor to the SRA.

Despite citing evidence that other solicitors in the immigration practice area sign blank documents, the tribunal found against her. The Solicitor accepted that more should have been done to guarantee that the solicitor was no longer on the court record.

The appropriate level of fine was £5,000, but taking into account the solicitor’s limited means, she was ordered to pay £2,500, plus £7,500 in costs.

http://www.legalfutures.co.uk/regulation/solicitors/fine-solicitor-signed-blank-claim-form-statement-truth

Legal Services Board releases Thematic Review of Restrictions on Choice of Insurer removing regulatory limits on who can provide PII

The latest review by the LSB has been supported by many including the Law Society following their decisions to remove historic regulatory restraints on practitioners’ choice of PII provider with fewer regulatory limits on who can provide PII.

http://www.legalservicesboard.org.uk/news_publications/LSB_news/PDF/2016/20160715_Review_Of_Restrictions_On_Choice_Of_Insurer.html

https://www.lawsociety.org.uk/news/press-releases/law-society-welcomes-lsb-review-of-restrictions-on-choice-of-insurer/

City calls for new investment from the Government to cut costs and increase the speed of litigation

The City is calling for the government to invest in cutting the cost and increasing the speed of litigation in the UK to safeguard the country’s 10% share in the global legal services market.

http://www.lawgazette.co.uk/news/city-calls-for-new-investment-to-speed-litigation/5056685.article

CII warns insurers about moving away from pooled risk

The CII has warned that the rise in sophisticated uses of data could create an “underclass” of people who can no longer afford appropriate insurance.

Insurers who are investing in big data resources which would enable them to better analyse the risks of each policyholder risk pricing customers out by moving away from pooled risk.

http://www.ft.com/cms/s/0/1900a88c-4e71-11e6-88c5-db83e98a590a.html

Tokio Marine Kiln launches its online platform for brokers

Tokio Marine Kiln has launched its new online broker portal designed to reach brokers on an international scale, speed up their service and cut out legwork at Lloyd’s. The Platform will act as an automated quote and buy process all online and easily accessible by the Brokers.

http://www.insurancebusinessmag.com/uk/news/breaking-news/tokio-marine-kiln-launches-online-broker-platform-34986.aspx

www.rcbllp.com

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Reynolds Colman Bradley LLP – News – Thursday 14 July 2016

SRA Responds to Law Society’s Criticism of Handbook Rewrite

The SRA has responded to criticism of their recently announced plans for a comprehensive rewrite of the Solicitors’ Handbook. The Law Society has portended that allowing solicitors to practise from unregulated firms would lead to a two-tier profession, leaving consumers unprotected.

Chief Executive of the SRA has cited regulation and indemnity insurance as being major factors in the rising costs of solicitors. By allowing solicitors to work outside the regulated realms is hoped to improve access to legal services for the general public who might not otherwise be able to afford it.

http://www.legalfutures.co.uk/latest-news/sra-hits-back-criticism-handbook-rewrite

http://www.legalfutures.co.uk/latest-news/law-society-lays-sra-handbook-rewrite-risk-creating-two-tier-profession

http://www.lawgazette.co.uk/practice/handbook-changes-could-lead-to-two-tier-profession-society/5056511.article

High Court Ruling on Predictive Coding in Disclosure Published

Brown v BCA Trading Ltd [2016] EWHC 1464 (Ch) (Ch D (Companies Ct))

The first reported decision in relation to predictive coding used for disclosure rather than the traditional keyword search finds extremely significant cost benefits in using the modern method.

Mr Registrar Jones stated that the costs for predictive coding in the case before him were in the region of £132,000. In comparison, the cost for keyword searches on the same matter could have been between £250,000 and £338,000.

He went on to say that “When the size of potential disclosure is significant both in terms of quantity of documents and the time required to be spent on the disclosure process, it is particularly important for the lawyers to identify by reference to the true issues, the anticipated categories of documents and to enter into discussions to seek to minimise the work required and therefore the costs.”

http://www.litigationfutures.com/news/high-court-cost-savings-predictive-coding-extremely-significant

Delayed Costs Application by Solicitors with “Inexplicable” Ignorance of Rules Rejected by Tribunal

Cozens v HMRC [2016] UKFTT (TC)

Judge Timothy Herrington, sitting in a First Tier Tax Tribunal, rejected a costs application for £34,168 which was delayed by 5 months. The Solicitors claimed that they had not been aware of rule 10(4) of the Tribunal rules which requires that such an application is to be made no later than 28 days after the release of the decision. Ignorance of the rules was not acceptable for legal professionals but may have attracted more lenience if a Litigant in Person.

http://www.litigationfutures.com/news/tribunal-rejects-costs-application-delayed-solicitors-inexplicable-ignorance-rules

Brokers are being Urged to Abide by the Rules Following Towergate’s £2.6m Fine

Following on from Towergate being fined £2.63m by the FCA for failures relating to their protection of client money and insurer money, the FCA is reiterating its warning that the industry must comply with client money rules.

There is some uncertainty as to how much impact this news will really have on the industry. Some consider that the fine is not punitive relative to such a company as Towergate and that any fines going forward would be relative to company size. Furthermore, the FCA regulates the rules by a means of auditing and in many cases brokers are simply making a decision not get certain accounts audited.

http://www.insuranceage.co.uk/insurance-age/news/2464714/towergate-accepts-fca-fine

http://www.insuranceage.co.uk/insurance-age/news/2464809/experts-urge-brokers-to-abide-by-the-rules-following-towergates-gbp26m-fine

New Underwriting Structure being Promised by Tokio Marine Kiln to Make Life Easier for Brokers

Tokio Marine Kiln has moved underwriting into four divisions along sector lines. The provider now consists of property, motor and liability; marine, aviation and special risks; accident, health and life; and reinsurance.

The aim is to make it easier for brokers to know where to direct their business. It will also provide access to both Lloyd’s and company paper to clients as the underwriting divisions can now write on both platforms.

http://www.insuranceage.co.uk/insurance-age/news/2464774/new-underwriting-structure-will-make-life-easier-for-brokers-promises-charles-franks