Insurer Winterthur's £100 million action against hundreds of law firms involved in The Accident Group (TAG) will be heard in April 2008, it has emerged.


Following a three-day case management conference that took place earlier this month, the insurer's claims for negligence and repayment of the accident investigation (AIL) fee will be managed together.



Lead cases are expected to be selected by the end of next month, the Gazette understands. The litigation will also enter a 'low-cost period', with plans for mediation.



Winterthur argues that firms handling claims under the TAG scheme were negligent in failing to vet and monitor cases properly, an allegation that the firms are defending vigorously. Last month the insurer decided, following a sample audit of 3,000 files, that only 10% of cases were not worth pursuing (see [2007] Gazette, 8 February, 1). There are 76,000 cases in total.



The AIL fee litigation relates to the £310 per case that law firms were obliged to pay to a sister company of TAG, Accident Investigations Limited, but which Senior Costs Judge Peter Hurst - later backed by the Court of Appeal - ruled was a referral fee. Referral fees were not allowed at the time under Law Society rules.



Glenda West, director at broker Prime Professions, said: 'This matter has now reached a real timeline with hundreds of firms facing uncertainty regarding cover under their professional indemnity policies.'



She said firms need to assess their potential exposures both in terms of AIL fees, number of excesses and liability. 'There is a danger of a global settlement which could expose firms to multiple deductibles and an impaired claims record without establishing liability.'



Advising law firms affected to seek guidance from one of the action groups that have been set up to defend the claims, Ms West added: '[A settlement] may be a good option from the insurers' point of view but firms really need to be prepared in the event that they are asked to make a contribution.'



Philip Hoult