After the event policies

The development of ‘after the event’ (ATE) liability policies to fund litigation has generated a mass of complex litigation relating to the conduct of solicitors, the operation of the Consumer Credit Act 1974 and the role of insurance in providing a fund to indemnify an unsuccessful claimant against litigation expenses. In Bank of Scotland v Euclidian (No 1) Ltd [2007] EWHC 1732 (Comm), Field J was asked to answer a series of questions on the ability of a lending bank to recover from ATE insurers sums loaned to claimants to purchase ATE insurance in circumstances where the claimants failed in their actions. Only the insurance aspects of the decision are considered here. The decision, as with many cases on ATE insurance, also involved complex points on the effect of infringements of the labyrinthine and technical requirements of the Consumer Credit Act (CCA) by lender.