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A whirlwind six months

Georgina Squire reflects on the groundbreaking judgments and procedural changes litigators have had to get to grips with and looks ahead to the possible impact of Brexit

5 July 2017

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The past six months have been full of surprises, across all spheres. Litigation is no exception and 2017 will undoubtedly be remembered by litigators as the year of game-changing judgments. We’ve also had to get to grips with e-filing in the Rolls Building and have the uncertainty of Brexit to look forward to.

So, what have litigators managed to pack into the first six months of this year? For a start, a number of groundbreaking decisions that will significantly impact on the way we as solicitors practise going forward, the insurance market, and after-the-event insurance and third-party funding. This article gives a brief snapshot of this year’s most talked-about cases so far.

Solicitors and their insurance

In Dreamvar (UK) Limited v Mishcon de Reya [2016] EWHC 3316 (Ch), Mishcon de Reya was found to be liable for breach of trust after its client was duped into buying a London property from a tenant posing as the owner. The court accepted that Mishcon de Reya had acted honestly and innocently in carrying out its role, but held that as the firm had insurance to cover the loss suffered in full, it was in a better position than the client to face the consequences. The judge added the ‘only practical remedy’ open to the client was to target the firm.

There was also the landmark decision of BPE Solicitors and another v Hughes-Holland [2017] UKSC 21 (Gabriel v Little in the Court of Appeal), in which the Supreme Court held that where an adviser is not responsible for the decision on whether to enter into a transaction, they are only liable for the damages resulting from the fact that the information they provided negligently was not correct. This applies even where the correct information may have revealed an actual or potential fraud.

Furthermore, in AIG Europe Limited v Woodman and others [2017] UKSC 18, the Supreme Court considered the meaning of the words ‘a series of related matters or transactions’ within an aggregation clause in 
solicitors’ professional indemnity policies.

The Court of Appeal had previously held that there must be an ‘intrinsic’ relationship between the transactions, rather than a relationship with some outside connecting factor. The Supreme Court rejected this introduction of further qualification into the aggregation provision and held that determining whether the transactions were related was fact dependent. In order for claims to be aggregated, it had to be shown that there was some interconnection between them and that they ‘in some way fit together’.

ATE insurance and third-party funding

The appeal in Plevin v Paragon Personal Finance Limited [2017] UKSC 23 considered whether the respondent’s ATE insurance premium in respect of the main appeal was recoverable from the appellant, and specifically whether proceedings in the Supreme Court (which commenced after the expiry of LASPO) 
were the same proceedings commenced by 
the respondent in 2009 (before LASPO expired, meaning that the ATE was recoverable). The Supreme Court held that 
the ATE was recoverable.

Meanwhile, in Persona Digital Telephony Ltd and another v The Minister for Public Enterprise and others [2017] IESC 27, the Irish Supreme Court concluded that third-party litigation funding was unlawful by reason of the rules 
on champerty.

New procedure

As if these landmark decisions were not enough to contend with, litigators have had to get a handle on e-filing in the Rolls Building. From April 2017, it is no longer possible to issue claims or applications, or file documents, on paper. All issuing and filings in any of the jurisdictions of the Rolls Building instead have to be made through the court’s e-filing website. This has proved challenging for even the most technically competent of us!

Brexit uncertainty

The catchphrase at the moment is, of course, ‘Brexit’. But what does Brexit mean for litigators? One obvious area is the recognition of foreign judgments.

If the UK does not agree to a convention on the reciprocal enforcement of judgments or agree a formal regime with the EU, then enforcement of UK judgments in the EU and vice versa will be subject to international conflict of laws rules. While judgments will still be capable of enforcement, it will likely add time and cost to cross-border enforcement. Litigators, along with the rest of the world, 
will be watching with interest as the negotiations unfold.

Challenges to costs and litigation funding will undoubtedly go on as the economy appears to be continuing to harden due to Brexit uncertainty. While the Irish Persona Digital case is an interesting development, it appears to run contrary to the trend in England, where court decisions have helped support ATE insurance and litigation funding is prevalent in all its forms.

Georgina Squire is head of dispute resolution at Rosling King and a member of the London Solicitors Litigation Association committee

www.lsla.co.uk

Categorised in:

Procedures Litigation Funding Professional negligence

Tagged in:

ATE insurance third-party funding Brexit