TAG firms to be paid, finally

A negotiated settlement was reached after a two-day mediation on the TAG test cases to sort out whether ‘no-win, no-fee’ agreements signed by accident victims with the claims company were lawful.

The session was overseen by the former senior law lord, Lord Browne-Wilkinson, and the parties have agreed to apply a 25 per cent discount to the agreed (or assessed) base costs in the bulk of the cases that have been held back pending the test case litigation. They have also agreed that individual claimants will not be asked to pay the shortfall of their costs. The terms of the mediation will be reflected in a consent order which, at its earliest, could be drawn up later today. Lord Browne-Wilkinson told the press that he was “delighted that this agreement should enable the thousands of backed-up claims for costs that have been tracking the outcome of the test litigation to be settled”.

“It’s a reasonable settlement,” commented Stewart McCulloch, a partner at Liverpool firm Mace & Jones, who acted for the claimants. “The mediation was very helpful in terms of everyone understanding that, on the claimant side, we are a legitimate force in the marketplace. I would hope that the mutual respect coming from the mediation will mean many more of these disputes can be resolved now.”

McCulloch added that “the issues that remain unresolved” relate to the second tranche of the TAG litigation, including two key features of the TAG product – the levels of recoverable insurance premium and the recoverability of investigation fees. Those issues are due to be heard in the Court of Appeal on 27 April unless settled earlier. Rachel Bolt, a partner at Beachcroft Wansbroughs, represented defendants in the mediation. “It’s a commercially sensible mediated agreement that works for both parties,” she said.