29 March 1999
25 April 2014
7 August 2014
23 June 2014
Choice of lawyer critical in health and safety investigations — further clarification now provided by the European court
12 June 2014
9 September 2013
I am a member of our Mutual Admiration Society. Why? As lawyers, our reputation is our most priceless asset. Our skill must always be of the highest quality. We must seek to give value for money. Important decisions should only be taken by clients after good sound legal advice. Our reputation is, however, underpinned by the security afforded to every user of legal services that if they have the misfortune to instruct a negligent or dishonest solicitor, then Solicitors Indemnity Fund (SIF) will meet the claim.
The fund was set up in 1987 following considerable pressure from politicians and the profession to improve arrangements for indemnifying the public and the profession against negligence claims. When a substantial projected shortfall on contributions was revealed (The Lawyer, 28 January 1997), a protracted debate culminated in the council voting to keep the fund earlier this month. The council was right to do so. Many of us were concerned about a possible doomsday scenario where we would opt to move into the open market just as rates were rising and capacity decreasing.
No one should forget that prior to the scheme there was a correct perception in the profession that some insurers were reluctant to pay valid claims without prolonged dispute. Insurers were unsympathetic and there was a belief that they took unfair advantage of their legal right to void the policies for non-disclosure. Solicitors were finding themselves unprotected through alleged or actual failures to disclose incidents in their past which they felt were trivial but insurers alleged were material.
Many critics of SIF have focused too narrowly on irrelevant issues. Some issues do need to be resolved, such as the need to develop adequately the contribution and deductible structure, but that does not justify losing the value of mutuality. We must ensure that the fund is fair to all practices.
The council had the benefit of evidence from the prestigious non-solicitor directors of SIF. They reminded the council that when SIF was first established, market conditions were particularly hard with cover becoming increasingly difficult to place and more expensive. How wise, they asked, would the profession be to abandon its mutual fund at a time when the market might be heading back towards that same difficult environment?
They also pointed out that the fund enjoys a tax-free status and that contributions do not attract insurance premium tax. The profession is able to operate in the certainty that cover will be available year in, year out with the comfort of open-ended run-off cover on retirement. Valid claims are never turned down and the fund remains accountable to the profession via the council - compelling arguments indeed.
I hope that everyone will now stop messing with our mutual and move on to the key debate of how we continue to improve and strengthen our reputation as lawyers.