Motor Industry Taskforce, CFA Disputes and SRA updates

Director of Legal Practice, Stuart Hanley , brings the latest legal and regulatory updates to your social feed.

I’m excited to share the second edition of my legal and regulatory digests, which I’ll be posting on LinkedIn each month. My aim is to provide you with valuable insights that fit seamlessly into your busy schedule and keep you informed about the latest updates.

In this edition, I’ve included updates on the Motor Industry Taskforce, CFA disputes, the SRA 2024/25 business plan and more.

If you have any questions or would like to discuss further, please don’t hesitate to leave a comment below or reach out to me directly. Enjoy the read!

Motor Industry Taskforce

The UK government has established a new taskforce, led by the Transport Secretary and Economic Secretary to the Treasury, to address the rising costs of car insurance, which have seen an average increase of 21% over the past two years.

This taskforce includes ministers from relevant government departments, as well as representatives from the Financial Conduct Authority and Competition and Markets Authority, and is supported by a stakeholder panel of industry experts from the insurance, motor, and consumer sectors. While there is currently no direct involvement from claimants, the government plans to broaden discussions with other stakeholders as more information becomes available.

The taskforce aims to focus on those hardest hit by rising costs, including ethnic minorities, low-income individuals, and elderly and young drivers. It is exploring the use of telematics or in-car black boxes for better risk-based pricing, particularly for new drivers.

Notably, motor injury claims have reached their lowest level ever, with 76,678 cases registered in the most recent quarter, representing an 11% decrease compared to the same period in 2023.

CFA Disputes

The recent Supreme Court decision in Oakwood Solicitors v Menzies clarified that the 12-month limit for clients to seek an assessment of their solicitor's bill begins only after they have both received and agreed to the bill.

Importantly, deductions for success fees or shortfalls can still be applied at the time of settlement if permitted by the conditional fee agreement (CFA). Legal Ombudsman (LeO) has emphasised that clients should never be surprised by such deductions from their damages. In response, law firms are encouraged to review their CFA terms and related documents to ensure clear communication about costs.

Additionally, the Civil Justice Council (CJC) is examining the Solicitors Act 1974, which is central to ongoing CFA challenges, and has published an interim report on Litigation Funding focusing on third-party funding. The Association of Consumer Support Organisations (ACSO) is collaborating with the Law Society on their 21st Century Justice paper, which includes updating guidance on Before the Event Legal Expenses Insurance (BTE LEI) and creating a new consumer factsheet, with efforts continuing through April 2025. These developments highlight the importance of client protection and transparency in legal costs within CFAs and litigation funding.

SRA: 2024/25 Business Plan

The Solicitors Regulation Authority (SRA) has released its 2024/25 Business Plan, highlighting key priorities for the upcoming year. The plan focuses on advancing the Consumer Protection Review, addressing issues related to bulk claims litigation, and enhancing risk identification and management through improved data utilisation.

The SRA is also considering potential changes to how law firms manage client monies, with a long-term possibility of restricting firms from retaining client money and earning interest on it. Additionally, the regulator is examining merger and acquisition activities in the legal sector to mitigate consumer risks.

A new Consumer Policy Team has been established to handle issues arising from bulk litigation reviews, including case funding and insurance matters. While the SRA does not plan to extend current price transparency rules to areas like personal injury, it aims to improve data comparability and accessibility of peer reviews.

Lastly, the regulator acknowledges the need to update guidance on unsolicited marketing approaches to address modern digital marketing practices.

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