The recoverability of premiums was not considered at The Accident Group (TAG) test cases last week, which TAG has claimed as a victory.
Senior costs judge Master Hurst considered a vital preliminary issue regarding the Conditional Fee Agreement (CFA) Regulations 2000.
Under regulation 4, a legal representative must explain aspects of the CFA to the claimant. However, under the TAG CFA scheme, a TAG employee, not a solicitor, gives the explanation.
The defendant insurers' lawyers argued that this did not comply with the regulation, rendering it unenforceable.
If they are correct, the defendants will not have to pay the claimants' costs.
A judgment is not expected for a few weeks. However, TAG's representative Anthony Dennison of Rowe Cohen said TAG had emerged victorious on one point.
He said the defendants' QC, Ian Burnett, had conceded to Master Hurst that the preliminary hearing was not expected to consider the recoverability of premiums.
Each claimant pays TAG about £970 to handle a claim. This sum does not cover solicitors' fees, which are arranged separately.
Dennison said that, until the concession by Burnett, the defendants' lawyers had relied on the county court decision in English v Clipson, where the premium was linked to regulation 4.
However Nick White of Beachcroft Wansbrough, who is acting for one of the defendants, said: "We're not saying the premium is recoverable, just that we'll cover that at a later hearing."
