Following a ruling in Peterborough & Stamford Hospitals NHS Trust v McMenemy & Ors, Lord Justice Lewison rejected challenges from NHS trusts in two cases that set out to test the principle of recoverability of after - the - event insurance premiums.
In each case, the Claimant took out ATE insurance as soon as Solicitors were instructed. Under the terms of each policy, the Claimants would have no ultimate liability to pay the premium. If the claim succeeded, the expectation was it would be paid by the unsuccessful Defendant. Throughout the aforesaid cases, Lord Justice Lewison acknowledged the heavy burden of clinical negligence costs and stated that the costs of civil litigation have been a matter of public concerns for many years. In addition, Lewison articulated that the government were fully aware when it created the costs regime through Legal Aid, Sentencing and Punishment of Offenders Act that ATE policies were taken out at the same time as entering a CFA. In addition, Lewison appreciated that it was clear from the government's response to the Jackson report that ATE insurance premiums relating to expert evidence could be recovered. In conclusion, Lewison invited the committee to reconsider the issue and consider whether rules or practice directions dealing with the recovery of ATE insurance premiums were required.