Sections 58 and 58A of the Courts and Legal Services Act 1990, which make provision for the regulation of conditional fee agreements and the recoverability of success fees, were amended by the Legal Aid, Sentencing and the Punishment of Offenders Act 2012 (LASPO 2012), as a result of which (subject to the transitional provisions) a success fee payable under a conditional fee agreement (“CFA”) may no longer be recovered from a losing party in any proceedings, but, subject to certain limits in personal injury cases, is recoverable from the legal representatives’ client.

Section 46 of LASPO 2012 repealed Section 29 of the Access to Justice Act 1999 (recovery of ATE insurance premiums) and made new provision relating to the recoverability of certain ATE premiums by inserting a new Section 58C into the Courts and Legal Services Act 1990. Section 58C(1) and (2) of the 1990 Act limits the recoverability of insurance premiums to clinical negligence proceedings and allows recovery of the premium only to the extent that it relates to the costs of any expert report.

The only experts’ reports in respect of which an insurance premium may be recovered are those which relate to liability or causation. The amount of the premium recoverable is limited to that part of the premium which insures against the risk of incurring a liability to pay the costs of any such report. The cost of such premium is allowed under the Costs Order. (See the Part 48 Practice Direction (paras 4.1 and 4.2) and The Recovery of Costs Insurance Premiums in Clinical Negligence Proceedings (No 2) Regulations 2013.)

Extract from the Senior Courts Costs Office Guide 2018