Case Law

Solicitors liable for failing to advise on ATE

14 May 2010
By Michael Hayes

Adris v Royal Bank of Scotland plc [2010] EWHC 941 (QB) has held that a solicitor is under a duty to advise its clients on the availability of After the Event insurance. Further, if a solicitor fails to provide such advice its clients are unable to take effective decisions and the solicitor is therefore acting without instructions. A non party costs order was made against the solicitor in this case, and it will be liable for costs on a joint and several basis with the Claimants against whom any costs order will be made. To the extent that the Claimants pays any costs at all, they would be wise to consider a professional negligence claim against the solicitor.

The ATE insurance market is mature and developed in this country and the level of press coverage afforded it recently (notwithstanding the level of knowledge a competent solicitor should be in possession of in any event)  means that there can be no excuse for failing to advise clients on the risks of litigation and the methods of mitigating that risk. This case only refers to ATE insurance but BTE insurance on household/commercial policies may also be available. Third party funding is only suitable for a small minority of cases but this too should be considered.