News in brief 11th February 2015

Virji moves on

Anil Virji, who in 2009 became the first Costs Lawyer partner in a solicitors’ firm, has moved to Civil and Commercial Costs Lawyers Ltd as its new head of costs.

Mr Virji was before that a partner and head of costs at Pictons, having previously led the costs team at Taylor Walton. He focuses in particular on major commercial litigation, clinical negligence, costs budgeting and case management, and also uses his advocacy rights.

He said: “The world of costs is changing, with opportunities for those with experience in higher and more technical levels of costs. I believe that Civil and Commercial has the core skills and teams to continue to impact into the new and exciting world of costs post-Jackson.”

Civil and Commercial’s managing director Andrew Thomas said: “I have known Anil for many years and am delighted to welcome him. A hire of this calibre can only demonstrate Civil and Commercial’s desire to continue to make significant pushing forward with our post-Jackson business strategy.”

Disbursement warning

A solicitor who negligently advises their client that a claim is likely to succeed and causes a client to incur disbursements which should not have been incurred will be liable to the client for those disbursements, the Court of Appeal ruled last week.

The court heard in Impact Funding Solutions v Barrington Support Services [2015] EWCA Civ 31 that Impact funded disbursements for industrial deafness claims but that the law firm, Barrington Support Services (now in liquidation), did not conduct rigorous checking before taking on cases.

In many unsuccessful cases, claimants’ legal expenses or after-the-event insurers avoided liability because of Barrington’s actions, leading Impact to seek recovery of its loans from the solicitors.

Impact successfully sued Barrington for £581,000 and then brought proceedings against its professional indemnity insurer, AIG Europe, under the Third Parties (Rights Against Insurers) Act 1930.

Longmore LJ said AIG accepted that Barrington’s liability to pay the loans fell “in principle” within the cover provided under the minimum terms and conditions for solicitors’ insurance, but the ruling at first instance said it also fell within the standard exclusion covering the “breach by any insured of the terms of any contract or arrangement for the supply to, or use by, any insured of goods or services in the course of the insured firm’s practice”.

But giving the judgment of the Court of Appeal, Lord Justice Longmore said “the essential purpose of the exclusion is to prevent insurers from being liable for what one might call liabilities of a solicitor in respect of those aspects of his practice which affect him or her personally as opposed to liabilities arising from his professional obligations to his or her clients” – such as liability to the supplier of a photocopier or cleaning services.

He said these obligations are to be distinguished from the obligations which are incurred in connection with the solicitor’s duty to his clients, which are intended to be covered. The Impact loans were made nominally to the solicitor’s client but were “an inherent part of a set of interlocking agreements all intended to enable the solicitor to earn a professional livelihood”.

This meant that obligations arising out of such loans “are essentially part and parcel of the obligations assumed by a solicitor in respect of his professional duties to his client rather than obligations personal to the solicitor” and so were covered by the indemnity insurance.

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11 Mar 2015

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