Norwich Union (NU) is locked in a legal battle with Reeds Solicitors in a dispute relating to the referral of legal expenses claims from Hill House Hammond (HHH).

Reeds claimed to have had an oral agreement with NU and HHH under which 80% of claims arising from legal expenses cover provided by HHH would be referred to the firm.

But when NU decided to close HHH it converted HHH policies into NU Direct policies and claims referrals to Reed "dried up".

Reeds claimed that this was in breach of the contract which was expected to last five years and ceased just one year in.

An NU spokesman said it was unable to comment on the case until it had been resolved.