SIF replies

Write to: The Editor, The Lawyer, 50 Poland Street, London W1V 4AX, fax 0171 970 4395, e-mail, DX44700 Soho Square.

I refer to the article by Graham Balchin headed "Troubled Indemnity" (The Lawyer, 28 October). The article contains factual inaccuracies that require correction and raises issues on which I should like to comment.

SIF has at its disposal a claims handling resource of considerable experience and expertise. Indeed, our advice is often sought by other schemes throughout the world. Our focus is on settling justified claims quickly and cost effectively and, to this end, we handle and settle an increasing number of claims in-house following a proper assessment of the merits and commercial issues in each case. It is simply not true to say "costs frequently exceed claims". Indeed, the comment that immediately follows in the article, on the proportion of costs to claims, itself undermines that contention.

Mr Balchin refers to two specific cases purporting to support his views. The first was indeed a straightforward personal injury claim arising from a strike-out under Order 17. Contrary to Mr Balchin's statement, SIF did indicate that liability would not be an issue. We confirmed we wished to consider settlement without proceedings, and invited details of the client's claim. These overtures were ignored, no attempt was made to negotiate, and proceedings were commenced quite unnecessarily. Although the claim has been settled, costs still remain to be resolved. They are, however, well below the figure quoted.

It is a gross distortion of the truth to state that SIF will not negotiate and is "unwilling" to settle any claims until proceedings are issued'. Indeed, the facts of this case indicate the opposite, namely that SIF is prepared to negotiate in the many cases where this is appropriate, but may on occasions be impeded by the readiness of a claimant's solicitors to commence proceedings unnecessarily.

The second case cited is, as is evident from the article, still live, in part. I am therefore not prepared to comment on its specific facts, save to say that there being a dispute upon the facts, an adjudication by the court was necessary and that the parties were well aware of the position long before the hearing. SIF shares the concern of the profession to root out dishonesty. It is right that proper care is taken and that each case is considered individually.

SIF continues to review its claims-handling procedures to improve its service to the profession. In doing so we have cost containment as a main focus. We will also build on the strengths already used to the profession's benefit, notably in risk improvement and in the co-ordination of major litigation, for example, wasted costs, Order 17s and the defence of claims by leaders.

Elizabeth Mullins

Managing director,