Richards Butler, Kennedys lock horns on TAG

Richards Butler and Kennedys have begun preliminary scuffles in the negligence case arising from the collapse of claims management company The Accident Group (TAG).

Richard Spafford of Richards Butler is representing insurer Winterthur as it attempts to recoup £70m in damages from 700 law firms that worked with TAG before its collapse in 2003.

The firms are also facing litigation to recover referral fees – money allegedly paid to TAG in return for personal injury (PI) work. Referral fees are unpopular because many solicitors see them as buying work unethically.

The case will go to trial later this year, but the sides faced off in January in a hearing over privilege. Winterthur wants access to confidential documents in the files of the defendant solicitors’ firms; the firms say that the files are protected by legal privilege and cannot be disclosed.

Firms involved in the litigation include Manchester-based Rowe Cohen, which coordinated TAG PI cases handled by other law firms. Most of the defendant firms are small practices focusing on PI, and a judgment against them could be disastrous. Already, some firms involved have reportedly found it harder to obtain the obligatory professional indemnity insurance because of their exposure to TAG.

The case has already had a bumpy ride. Winterthur originally instructed Spafford when he was a partner at professional negligence heavyweight Barlow Lyde & Gilbert (BLG). In April 2005, Spafford moved firms to Richards Butler and took the work with him. Commentators said that losing TAG was a blessing in disguise for BLG, which handles many cases each year for defendant law firms and their insurers – the other side in the TAG case.

Kennedys partner Simon Gibson is acting for 300 of the defendant solicitor firms, instructing Justin Fenwick QC of Four New Square. Other firms involved for defendant solicitors include Berrymans Lace Mawer, with partner Charlotte Capstick instructing Jeremy Stuart-Smith QC, also of Four New Square, and Bond Pearce, with partner Erik Salomonson instructing Sue Carr QC, another Four New Square tenant.

Rowe Cohen is represented by Clive Brett of Oxford firm Henmans, instructing Ben Patten of Four New Square.

Spafford has instructed Brick Court Chambers’ William Wood QC for Winterthur.