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Solicitor’s liability for costs of action

Germany v Flatman; Barchester v Weddall [2011] EWHC Civ 2945 (QB)

Eady J yesterday handed down judgment in these two cases in which Richard Sage and Simon J Brown appeared for the successful Defendants.

In both cases the Defendants successfully resisted a personal injury claim and obtained an order for costs in their favour. There was however no real prospect of recovery from the Claimants, neither of whom had ATE insurance. The Defendants sought further information and disclosure concerning the funding arrangements suspecting that the Claimant’s solicitors had in some measure funded the claims by defraying disbursements. HH Judge Moloney QC refused the applications having concluded that if such orders were routinely granted it would undermine the current system of funding arrangements.

Eady J allowed the appeal. He considered that the Judge Moloney had overstated concerns that the granting of the application would ‘open the floodgates’. The Defendants’ suspicions as to the funding of the claim were well founded and if the Claimant’s solicitors had funded the claim this would place them outside the normal role of solicitor. He approved the line of authority to the effect that it was wrong to allow someone to fund litigation in the hope of gaining a benefit without a corresponding risk that that person will share in the costs of the proceedings if they ultimately fail.

The orders requiring solicitors to provided further information and disclosure were granted.


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