Who pays?

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  • I don't think this summary is quite accurate. Some policy wordings address the issue, purportedly at least. Others, including the ARP wording, are silent. In Ariel Zeckler v Assigned Risk Pool Manager Capita Commercial Services Ltd, the Court acknowledged that there is room for argument, sufficient to justify setting aside a statutory demand served by the managers of the ARP on a member of an LLP for payment of the premium. So the ARP will have to (and can) bring fresh proceedings if they wish to pursue the point. The decision of the Chief Registrar was based on a false premise, that regulation of solicitors is contractual through membership of the Law Society. However, no bank would expect an LLP member to be personally liable on a loan to the LLP unless the members had signed personal guarantees. Why should insurers be in any better position? (I believe some may ask for PGs from small firm members.) I have previously litigated the point for LLP members but the matter was resolved at mediation, so there is as yet no authority apart from Jones v St Paul (badly flawed in many respects), which was not cited.

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