Despite the Bar Council’s best efforts, barristers’ immunity from being sued for negligence in court has been abolished.
The move could result in a 50 per cent increase in the cost of indemnity insurance as well as changing the way barristers receive instructions.
A typical chambers with between 35 and 45 tenants now pays about £60,000 per year, to provide £2.5m a head of cover. But this premium is set to rise to well above the £100,000 mark.
While it is a breach of the bar’s code of conduct for a barrister not to have professional indemnity insurance, the minimum amount of cover required is only £250,000, and in many chambers it is left to individual practitioners to insure themselves.
One eminent silk at a leading commercial set says: “Cover will cost more simply because of the perception of insurers that the risk of exposure is greater.” However, he stresses that many barristers already have extensive immunity cover, which for some leading silks can run to tens of millions of pounds.
Michael Meeson, chambers director at 39 Essex Street, says: “All our barristers are insured. It will lead to us considering the levels of insurance which must, inevitably, go up and premiums will go up.”
Justin Fenwick QC, chairman of the Bar Mutual Indemnity Fund, says: “It is obviously an important decision and we will be studying the implications with care.”
However, he was unwilling at this stage to comment on the potential cost implications for barristers’ professional indemnity insurance.
One of the bar’s main fears is that the floodgates will open and leave it exposed to a massive increase in the number of claims against barristers.
One leading silk says: “There may well be a move to barristers using contracts more, seeking to exclude or limit liability.
“It is all part of us having to recognise that we are service providers and that we have a duty of care, not just as individuals but corporately as a chambers.”
Another eminent silk at a leading commercial set thinks that there could even be negligence actions taken against decisions already made. He says: “My gut reaction is that it could be retrospective up to six years.”
He adds: “There is a risk that clients who insist on running bad cases may not be able to see, despite being advised, that that is indeed the position, and then pursue the barrister when the action fails.”
However, the House of Lords emphasised that while many negligence actions might be started, few would be allowed to continue.
In his judgment, Lord Steyn says: “It will not be easy to establish negligence against a barrister.”
He adds: “There would be benefits to be gained from the ending of immunity. First, and most importantly, it will bring to an end an anomalous exception to the basic premise that there should be a remedy for a wrong.
“There is no reason to fear a flood of negligence suits against barristers. The mere doing of his duty to the court by the advocate to the detriment of his client could never be called negligent.”
If there is a flood of actions the bar will ultimately profit, with leading professional negligence sets, especially those that specialise in solicitors’ negligence, best placed to take advantage of a new market.
Patrick Gaul, lead partner for Weightmans, the firm instructed by the Solicitors Indemnity Fund (SIF), says: “It will, I think, make barristers think more about accepting late or poorly prepared instructions. They will be more fastidious over instructions that they don’t think are particularly good.”
This, he says, could lead to an increased administrative burden on barristers, who may be forced to keep better records about when instructions are received late or not prepared properly.
He adds: “As Sumption [Jonathan Sumption QC for the SIF] said in the House of Lords, it may lead to some defensive lawyering in the same way as we already see defensive medicine.”
A leading silk agrees that records must be improved and that the cost of this extra administrative burden will ultimately be passed to the client.
In his judgment, Lord Hoffmann agreed that Sumption’s argument must be taken seriously.
Despite the greater risk of negligence actions against them, most barristers ultimately believe that the decision was both inevitable and correct.
Lord Hoffmann in his conclusion says: “I have now considered all the argument relied upon in Rondel v Worsley. In the conditions of today, they no longer carry the degree of conviction which would in my opinion be necessary to sustain the immunity. The empirical evidence to support the divided loyalty and cab rank arguments is lacking; the witness analogy is based upon mistaken reasoning and the collateral attack argument deals with a real problem in the wrong way.”
The law lords’ ruling
Arthur J S Hall & Co (a firm) v Melvyn Keith Simons; Barratt v Woolf Seddon (a firm); Harris v Scholfield Roberts & Hill (a firm)
Court: House of Lords
Judges: Lords Browne-Wilkinson, Steyn, Hoffmann, Hope, Hutton, Hobhouse and Millett
Held: (1) Given the changes in society and in the law that have taken place since the decision in Rondel it is appropriate to review the public policy decision that advocates enjoyed immunity from liability for the negligent conduct of a case in court. The propriety of maintaining such immunity depended upon the balance between, on the one hand, the normal right of an individual to be compensated for a legal wrong done to him and, on the other, the advantages which accrued to the public interest from such immunity. In relation to claims for immunity for an advocate in civil proceedings, such balance no longer showed sufficient public benefit as to justify the maintenance of the immunity of the advocate. (2) (Lords Hope, Hutton and Hobhouse dissenting) The immunity should be abolished in relation to all proceedings, and not merely in relation to the conduct of civil proceedings.