Lawyers may be unaware of the onerous personal duties and obligations in this area under the SRA’s Standards and Regulations (STaRs), introduced late 2019.

In short, lawyers involved in litigation and dispute resolution have a duty to advise their clients about the availability, suitability and benefits of After the Event (ATE) insurance as well as litigation funding. Failure to do so may have repercussions on the firm, but also on the individual solicitors whose advice fell short. These penalties could include fines and sanctions from the regulator and potential professional negligence claims from the client.

The introduction of principles-based personal responsibility is a characteristic of the STaRs regime. It requires individual solicitors to present information to their clients in a comprehensible way, and to ensure they are able to make informed decisions. Costs are mentioned specifically in the SRA’s Code of Conduct for Solicitors, so by extension every solicitor involved in a client’s relevant commercial dispute has a personal obligation to advise about the suitability of ATE insurance and litigation funding. 

Litigation funding and ATE are closely linked. Typically ATE will cover adverse costs ordered to pay opponent’s legal costs if a claim is unsuccessful and funders fund the clients’ costs to pursue the litigation. Funders are unlikely to finance a case for a claimant without the protection provided by ATE.

Simply providing the contact details of an insurer or allowing a litigation funder to seek insurance arrangements themselves is insufficient. This would fail to fulfil the requirement to advise on the suitability of these products based on the bespoke nature of each case. However, referring the client to an insurance broker specialising in After the Event insurance does discharge this duty. Miller is able to help solicitors and their clients by: 

  • advising on the appropriateness of ATE and funding in the circumstances and the market options, 
  • obtain cover appropriate to the risk whether opponent’s costs or own costs, and 
  • introduce credible litigation funders who will provide the client with the resources necessary to take a claim to trial and achieve justice. 

The benefits of ATE are significant. Not only does it provide financial certainty in an unsuccessful scenario for an insured, but it creates a powerful incentive for the opponent to settle. Having ATE in place means defendants and their legal representatives know that an insurer has already reviewed the evidence and assessed the case and believe the prospects are strong. 

Miller is a full-service ATE broker, acting as the intermediary between solicitors, funders, and risk carriers. We help to ensure that our clients find not only the right level and structure of ATE coverage, but also, when necessary, the most appropriate litigation funders. With the introduction of Miller, individual solicitors’ responsibilities under STaRs are discharged and the best possible outcome for all, win or lose, is ensured. 

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