Information is power

There has been much adverse publicity recently about the activities of so-called claims farmers. Many solicitors still use independent agents to obtain initial instructions or accept referrals from independent companies in relation to potential claims. However, once a retainer is established between solicitor and client, the solicitor becomes liable for ensuring that the client is given all the information that is required.


An employee of solicitors made contact through a public Web site with a person who had been involved in a road traffic accident. After a series of private messages a freelance agent visited the client at home. During that meeting a conditional fee agreement (CFA) was signed by the client, but not completed or dated. No copy of the agreement was given to the client, and there was no record of what information had been given to him.


Following a subsequent telephone attendance by an employee of the solicitors, at which certain oral information was given, the agreement was completed and dated. However, the solicitors were unable to show that the information required by the CFA regulations to be given in writing was sent.


The client was advised orally that the work carried out by the solicitors would be at no cost to him. There was no evidence that any other costs information was given, nor, specifically, information regarding the effect of terminating the agreement. The CFA itself stated that it had been ascertained that the client did not have the benefit of before-the-event (BTE) Insurance, although it later transpired that the client, who had been driving his mother's car, did have the benefit of a policy. The agreement was terminated by the client within a short time, at which point the solicitors delivered an account for their costs.


Following the client's complaint to the Law Society the matter came before an adjudicator for determination. He found on the basis of the evidence that the solicitors had not complied with the CFA regulations nor had they complied with the solicitors costs information and client care code. It was also not adequate that they had relied on a statement from the client about BTE insurance without making further enquiries.


Although the adjudicator could not make a determination about the enforceability of the agreement itself, he found that the service provided by the solicitors was clearly inadequate. It was directed that the solicitors pay compensation for the distress and inconvenience caused to the clients and also that their costs be remitted in full.


More care on the solicitors' part in ensuring that the client received proper information at the outset of the matter would have avoided the consequences that followed.


This case study is for illustration only and should not be treated as a precedent