Gavin Edmondson Solicitors Ltd v Haven Insurance Company Ltd  UKSC 21
This case involved six Claimants who were involved in road traffic accidents with the drivers being insured by Haven Insurance Company. The individuals involved instructed and entered into CFAs with Gavin Edmondson Solicitors Ltd.
As required under the Pre-action Protocol for Low Value Personal Injury Claims in Road Traffic Accidents, details of the claims were lodged on the Portal by Gavin Edmondson Solicitors. However, instead of Haven Insurance Company responding with their decision on liability they made settlement offers directly to the Claimants which did not include any amount for their Solicitors’ costs. They advised the Claimants that dealing with them direct would result in a more favourable and speedier settlement for them rather than proceeding through the Portal.
Eventually, all the Claimants accepted the settlement offers and cancelled their CFAs with Gavin Edmondson Solicitors.
Gavin Edmondson Solicitors then brought a claim against Haven Insurance Company for failing to pay them the fixed costs required under the Portal and more specifically, they sought the enforcement of the Solicitor’s equitable lien.
Following the initial dismissal of the claim, the Court of Appeal allowed the appeal holding that, even though the Claimants did not have a contractual liability for the firm’s charges, the remedy could be modernised to allow the solicitors to recover from the insurers their fixed costs that should have been paid under the Protocol.
Haven Insurance Company then appealed to The Supreme Court who unanimously dismissed the appeal. In summary the Court held that Gavin Edmondson Solicitors were entitled to the enforcement of the traditional equitable lien against Haven, as the client owed a contractual duty to pay the solicitors’ charges. However, the equitable lien should not have been modernised in the manner undertaken by the Court of Appeal. The Court held that the obligation to pay the costs owed to the creation of the CFAs, and that as the claims were proceeding via the Portal, Haven Insurance had notice of the equitable lien which made any settlement direct with the Claimant unacceptable.
This is an important decision which provides guidance on the operation of a Claimant Solicitor’s retainer.