The concerns of 2,911 law firms and sole practitioners who took out professional indemnity insurance (PII) policies with Quinn Insurance are set to continue this week after the Irish High Court adjourned a hearing on the fate of the Irish insurer.

The court will now decide whether or not to place Quinn Insurance in permanent administration on Monday 19 April, leaving affected solicitors in limbo for another week.

The Solicitors Regulation Authority today reiterated its advice to solicitors to sit tight pending the outcome of the administration hearing.

According to reports, Quinn Insurance today presented fresh information to the court at the last minute, and the Irish Financial Regulator, which is attempting to have the company placed into permanent administration, asked for a week-long adjournment.

Quinn Insurance, which provides PII to around 10% of the solicitors’ profession, will remain in provisional administration for the time being.

Quinn Insurance was forced into provisional administration after the regulator successfully petitioned the High Court on 30 March. At the time, the regulator directed Quinn to cease writing new business in the UK ‘to prevent Quinn Insurance Ltd suffering further financial losses from its currently unprofitable UK business’, and simultaneously began an investigation into financial guarantees, estimated to be worth €448m (£394m) altogether, set up by subsidiaries of Quinn Insurance. The guarantees were alleged to have been used inappropriately to set off debts from other companies that make up the Quinn group conglomerate – an allegation that Quinn fiercely denied.

Quinn attacked the regulator’s actions as ‘pre-emptive, aggressive and unnecessary’ and said that a planned refinancing would have addressed the regulator’s concerns around the financial guarantees.

Solicitors’ rules state that law firms must find alternative cover or apply to enter the assigned risks pool within four weeks if an insurer has provisional administrators appointed, but the SRA said that the situation with Quinn falls outside its definition of provisional administration.

In a letter to the Gazette this week, Law Society chief executive Des Hudson says that Quinn's predicament is a cause for concern, but advises solicitors that there is no need for panic.

Update: On Tuesday 13 April, Quinn Group hired financial restructuring firm Talbot Hughes McKillop to provide financial restructuring services to the company. Talbot Hughes McKillop partner Murdoch McKillop was also appointed as an interim executive director of Quinn Group.

Quinn Group chief executive Liam McCaffrey said: ‘Mr McKillop’s role will be to assist the board and the executive management team to successfully work through the group’s current issues and to ensure that executive management are not excessively diverted from the vitally important job of running our manufacturing business.’

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