Sudden sanctions – Dealing with a liability claim - Much Ado About Insurance
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Sudden sanctions – Dealing with a liability claim

If you’re dealing with a legal dispute and don’t know who to turn to, there are ways of seeking legal advice which don’t cost the earth.  The most common commercial disputes range from non-payment of goods or services, misrepresentation or contracted goods being of lower quality than expected.

Then there’s the issue of contracts and who has broken them. For example, if someone has moved out of a rented property before the end of their tenancy due to mould growing on the walls, the landlord may argue they have broken their contract. The former tenant may then counteract this by stating that the landlord broke their side of the contract by not taking sufficient maintenance measures to ensure the property was safe to live in. This is when the dispute may be taken to court.

For larger companies, resorting to legal proceedings may seem like the best course of action, with some having the means to provide their own team of lawyers and solicitors. However, for SME companies and individuals, court is a last resort and the cost and stress of legal action can take a huge toll, with solicitor’s hourly rates ranging from £177 – £296.

Are you covered?
When faced with legal action, it’s worth checking if your insurance covers you for legal costs, including defence, investigation, court and compensation fees. This comes with the majority of liability cover, so for SME’s with appropriate insurance, this should cover the feeds surrounding a liability case.

For self-employed professionals, if you have professional indemnity insurance, this should cover the cost of legal fees, subject to your insurance covering the occurrence the claim is related to.

If you’re an individual facing or instigating legal action against a company, check for legal cover in the insurance you currently have, such as your home insurance. This would typically cover legal incidents relating to your home, job, death or personal injury. However, there will be a number of instances which will not be covered. If you’re in a trade union and your claim is employment related, they may cover the costs, if they believe you have over a 50% chance of winning your claim.

Legal Aid
Legal Aid is aimed at those on benefits or with very low incomes. This will also take into account other factors such as your disposable income, savings and additional benefits for areas like child support. Legal Aid is intended to cover family law, debt problems, domestic violence, social security benefits, housing, employment, asylum, adoption disputes, mental health and personal injury claims.

You will generally only eligible for Legal Aid if you meet the strict set of criteria, show that your problem is serious and prove you cannot afford the legal costs. This service has been cut drastically in the recent years, yet, it’s still worth checking if you’re eligible for the support.

Free legal clinics
If you don’t qualify for Legal Aid, your next port of call should be Citizen’s Advice. This service provides free, confidential and impartial advice on the steps you can take to move forward from your problem. They help you to see that you have other options and are available through a number of mediums including phone, webchat, face-to-face and online help. They also provide a large bank of articles and references on a number of issues from bankruptcy to buying a faulty car.

There are also free legal clinics held by law firms, which can provide advice and may be able to refer you to a solicitor or barrister who can represent you on a pro bono basis. It’s best to arrive early to these clinics as they tend to be run on a ‘first come, first served’ basis.

Solicitors
Try not to simply use the first solicitor you come into contact with; it helps to compare them by their price and level of service. Ensure to do your research in advance as some charge for an introductory session and you don’t to find out that their service is not what you expect after paying this fee. You may even want to extend your search to barristers as since they’re typically self-employed, they’re sometimes cheaper than solicitors.

If you hire a barrister, be prepared to do some more of the administrative work yourself, as this won’t be covered under their service.

Regardless of your issue, as soon as you become aware that you either want to raise or fight legal action, make sure you let your insurer know if you have liability cover. If you try to fix the issue yourself initially and make things worse, you may inadvertently void your insurance claim.

If you want to check your existing insurance for liability cover or are looking to arrange a policy that covers you for the financial repercussions of legal action, contact Much Ado About Insurance on 01789 508 900.