By Rachel Rothwell


A group of solicitors who were employed by a firm which has since gone into liquidation could find themselves being pursued for a contribution towards an unpaid insurance premium of £834,000 - despite the fact that they were not partners in the firm - the Gazette learned this week.



Around 26 solicitors who were employed by Merricks LLP, which went into administration in April 2004 and liquidation in January 2006, have been sent a letter by five former members of the firm alerting them that they may seek a payment from the employees.



One solicitor who had received the letter said that it was 'outrageous' and could have 'profound' implications for all assistants and associates.



The letter was sent by Tony Guise of London firm Guise who is acting for five former members of Merricks: John Clementson, Eleanor Leonard, Alison Gill, Nicholas Plaut and Sabina Rinker. They were no longer members of Merricks when it went into administration.



Merricks did not arrange to take out run-off insurance cover when it went into administration. The insurers which were obliged to provide the cover are now suing all those who were members of Merricks in the insurance year running from 1 September 2003 for the unpaid insurance premium of £834,437.



The former partners are vigorously defending the claim. However, Guise has written to around 26 solicitors who were employed by Merricks at the time - who were not members of the partnership - stating that if the former partners are obliged to pay the premium, they in turn will be 'seeking a contribution' from the solicitors. The letter says that if the court does allow recovery of the premium by the insurers, it will do so on the basis that 'the insured' as defined in the insurance policy are liable to pay. This would include employees as well as partners.



One solicitor who received the letter said: 'It is entirely unreasonable to try to claim expenses of a practice that has gone into administration from the employees. We had no involvement in any way, shape or form with taking out the insurance... We did not share in the profits.' He added: 'This would have serious ramifications for every assistant and associate solicitor in England and Wales.'



The lawyer said one of the solicitors who received the letter had been newly qualified when working at Merricks, and was 'distraught' to have received it.



Guise said: 'We are contesting the claim that our clients and anyone else is liable for the premium. If the insurers are correct, all fee-earners and employees are equally liable... We did notify former solicitors [at the firm] of their potential liability under the policy. If the insurers are correct, then there is an exposure.' Guise added that his clients would not seek a contribution from any employees of the firm who were not solicitors.