KA-2023-000225 - [2025] EWHC 1605 (KB)

The relevant part of the Points of Dispute served by the Appellant read as follows:

“The Claimant disputes the cash account because he is not satisfied that there has been full and accurate disclosure of the position in relation to (a) undisclosed commissions and / or other secret profits and (b) disbursement of legal fees. It will be noted in relation to (b) that the Claimant entered into a separate express Damages Based Agreement with AJG Limited which provided for the “25% success fee” to be taken by AJG Limited rather than the Defendant. If the Defendant has passed those funds belonging to the Claimant to AJG Limited, as it said it would, the payment should be recorded in the cash account. The fact that it is not is a concern.

[...]

The Claimant invites the Defendant to respond to the Part 18 Request that has already been raised (on 18th July 2022), and to adjust the cash account to reflect any receipts or payments that may have been omitted. Once the Defendant has responded the Claimant will be in a position to take stock and, if the cash account remains in dispute, to propose suitable directions to resolve the point.”

The Respondent characterised the Part 18 request as “a fishing expedition” to which no response was required although it identified the payment to AJG as having been made on the 27th of October 2020. The Appellant's concern regarding this payment stemmed from the fact that AJG Limited was a Gibraltar-based company, potentially owned by the Respondent or connected with it, which had undertaken no work for the client. The Appellant wished to investigate AJG Limited and required the company number for such investigations. The Respondent's resistance to providing this information was viewed by the Appellant as “troubling”, reinforcing his concerns over the cash account.

The Appellant's “dispute” concerning the After the Event (ATE) premium did not directly challenge the reasonableness or quantum of the £245 premium itself within the Solicitors Act assessment proceedings, consistent with the judgment in Herbert v HH Law Ltd. [2019] 1 WLR 4253 (see further below). Instead, it focused on the possibility of undisclosed commissions or other financial benefits received by the Defendant (or an associate) as a result of arranging the ATE insurance.

ATE insurance is bought to protect against legal costs if a claim fails. While typically inexpensive for personal injury claims, the issue raised in the Points of Dispute was whether there was an inflated premium and/or additional payment returned to the solicitor as a "secret commission" either directly or via a third party.

The Appellant had served Part 18 requests seeking comprehensive information regarding the ATE insurance arrangements, including details of all intermediaries involved, confirmation of the premium amount paid to the insurer, and specific details of any direct or indirect payments (commissions, discounts, etc.) received by the Defendant or any associate from the insurer or intermediaries. The underlying argument was that any such undisclosed financial benefits would constitute client money and should be credited to the cash account.