Warning notice

Holiday sickness claims

Issued on 6 September 2017 | Updated on 9 August 2018

Status

While this document does not form part of the SRA Handbook, we may have regard to it when exercising its regulatory functions.

Who is this warning notice relevant to?

This warning notice is relevant to all those we regulate who act in personal injury cases, particularly holiday sickness claims.

Our expectations

We expect that all those regulated by us comply with the Principles and Outcomes of the SRA Handbook 2011. We expect that law firms and solicitors do not conduct fraudulent or questionable cases and that all costs charged to a client are explained, agreed and set at a reasonable rate.

What misconduct we are seeing

According to the Association of British Travel Agents, there has been a 500 percent increase in compensation claims for holiday sickness since 2013. In matters reported to us we have seen some behaviours that give us cause for concern.

We have seen firms:

  • taking on matters whilst lacking competence and skill in the area of law
  • failing to ensure that they do not accept cases from introducers who are cold calling or failing to verify the source of the referral
  • entering into improper referral arrangements and allowing their independence to be compromised by, for example favouring the interests of the referrer
  • failing to properly identify clients and confirm client instructions including the verification of relevant documentation to support a claim
  • bringing a claim without first investigating whether it is valid
  • making unreasonable requests for disclosure from the defendant or their lawyers
  • failing to objectively assess and investigate adverse evidence
  • failing to properly advise clients about what will be expected of them when making a claim
  • submitting false or dubious claims in the hope of a settlement without further investigation by the defendant
  • seeking unreasonable costs – either from the client or the defendant

Firms who conduct cases which demonstrate one or more of these features may face regulatory action for breach of our Principles.

We are investigating firms involved in holiday claims, including potentially improper links with claims management companies and payment for referrals of holiday sickness claims. We are also seeing firms pursuing claims without the proper instructions of claimants.

Holiday claims exemplify our concern that some law firms fail to engage properly, or sometimes at all, with the merits of their clients’ cases. This is of concern where there is evidence to suggest that the claim is false or dubious in some way. We are clear in our view that lawyers should not bring cases, or continue with them, where there is a serious concern about the honesty or reliability of the evidence

You should not pursue claims or continue with claims where you do not have the claimant’s clear and express authority to do so. The extent to which law firms should verify their clients’ cases is risk-specific. For example, there seems to be a serious risk that many holiday sickness claims are not genuine. Examples of risk factors in holiday sickness claims would include:

  • The claim is made some time after the alleged incident
  • There was no report of the claim to the hotel
  • There was no extensive sickness amongst others in the same accommodation – see Wood v TUI Travel [2017] EWCA Civ 11
  • The claim comes from or involves people that have actively sought out/farmed for claims in a resort
  • The client’s contemporaneous report of the holiday was positive
  • The client drank or ate excessively before or after becoming ill

The difficulties of holiday sickness claims are clearly evident from the case of Wood v TUI Travel [2017] EWCA Civ 11 in which the Court of Appeal commented:

...it will always be difficult (indeed, very difficult) to prove that an illness is a consequence of food or drink which was not of a satisfactory quality, unless there is cogent evidence that others have been similarly affected and alternative explanations would have to be excluded…

Solicitors must engage with this and properly assess all the evidence before submitting claims.

We have also seen failures to make sure that all documentary evidence is collated and analysed. We have seen highly improper advice to clients to delete evidence, for example, deleting social media updates or pictures.

In all litigation, firms must immediately inform clients of their duty to preserve evidence and require it all to be provided for the firm to review. This is a critical duty to the administration of justice, including to prevent or reduce the public cost of unmeritorious claims. Firms must of course also be rigorous in storing, retrieving, analysing and acting upon evidence they hold, including seeking disclosure where it is appropriate. Claims should not be submitted until the client has been properly advised on all relevant evidence and on the merits of their case – and when the client has given clear instructions and authority, on a fully informed basis, that the case should be pursued.

A narrow approach to this by the firm is liable to be treated as ‘turning a blind eye’ which of course can lead to dishonesty findings. In Barlow Clowes v Eurotrust [2005] UKPC 37 it was noted that a dishonest state of mind "may consist in suspicion combined with a conscious decision not to make inquiries which might result in knowledge".

These principles apply to all litigation. The impact of unmeritorious claims on the administration of justice and indeed on those who are subjected to such claims means that solicitors must not pursue them where there is evidence that they are false or clearly unmeritorious.

If there are allegations or concerns about a case, law firms must not turn a blind eye, but instead must engage with them and objectively assess whether the case can properly be pursued.

An example of this might be allegations that claims are being generated or co-ordinated by organised criminals, as we have seen in ‘cash for crash’ cases. Law firms cannot simply ignore such allegations, and nor can they simply assert that they consider them unproved or unfounded. They must engage properly with them and bear in mind their duty to the administration of justice.

Cold calling

There have been reports of introducers and people seeking out claims laims farmers approaching holiday makers to generate sickness claims. Outcome (8.3) requires that you do not make unsolicited approaches in person or by telephone to members of the public to publicise your firm or another business. Outcome (9.4) requires you to be satisfied that any client referred by an introducer has not been acquired because of marketing or other activities which, if done by you, would be contrary to the Principles or any requirements of the Code.

Referral arrangements

You should take steps to make sure that you verify the source of any referral.

You should terminate any arrangement with an introducer or fee-sharer which is causing you to breach the Principles or any requirements of the Code (IB (9.3)). Outcome (9.8) requires you not to pay a prohibited referral fee.

Please see our previously published guidance on the Legal Aid, Sentencing and Punishment of Offenders Act 2012 (LASPO).

Where you have a referral arrangement that is not in breach of LASPO, you still need to comply with the outcomes that are set out chapters 6 and 9 of the SRA Code of Conduct when making or receiving any referrals. Reports have been made that referrals are being made to a third party, for example a medical expert, when it is not in the client’s best interests or likely to progress a claim as the referral is made after a significant time has passed.

Suspect or dubious claims

When taking instructions, you should make sure that you have clear details of the client’s identity. You should analyse the evidence rigorously. No claim should be made unless there is a sound basis for the claim and you have valid instructions.

Dishonest claims

There are a number of reports of cases where claims have been dismissed as dishonest, leading to costs orders against claimants and even a criminal prosecution. Solicitors do not help clients by bringing claims that have not been rigorously investigated, including consideration of adverse evidence.

Taking unfair advantage

Outcome (11.1) provides that you must not take unfair advantage of third parties.

Acting in the following way may tend to show that you have not achieved outcomes and therefore complied with the principles.

IB (11.8) demanding anything for yourself or on behalf of your client that is not legally recoverable.

You should not demand anything from a third party, such as compensation for holiday sickness, where there is no legal right to recovery.

Seeking high costs from defendants that are not fair and reasonable, having regard to the complexities of the matter and work done, may also constitute an attempt to take unfair advantage. Submitting a claim for unfair and unreasonable costs might also involve you taking steps that could mislead the court, for example, about work you have not done.

Enforcement Action

Failure to have proper regard to this warning notice is likely to lead to disciplinary action.

Relevant SRA Principles

Principle 1: Uphold the rule of law and the proper administration of justice.

You have obligations not only to clients but also to the court and to third parties with whom you have dealings on your clients' behalf (Part 1 – SRA Principles para 2.5).

Principle 2: Act with integrity.

Personal integrity is central to your role as the client's trusted adviser and should characterise all your professional dealings with clients, the court, other lawyers and the public (Part 1 – SRA Principles para 2.6).

Principle 4: You must act in the best interests of each client.

You should always act in good faith and do your best for each of your clients (Part 1 – SRA Principles para 2.8).

Principle 5: You must provide a proper standard of service to your clients.

You should provide a proper standard of client care and of work. This would include exercising competence, skill and diligence, and taking into account the individual needs and circumstances of each client (Part 1 – SRA Principles para 2.9).

Principle 6: You must behave in a way that maintains the trust the public places in you and in the provision of legal services.

Members of the public should be able to place their trust in you. Any behaviour either within or outside your professional practice which undermines this trust damages not only you, but also the ability of the legal profession as a whole to serve society (Part 1 – SRA Principles para 2.11).

SRA Code of Conduct 2011 mandatory outcomes

You should also have regard to the specific outcomes in the SRA Code of Conduct 2011, that have been referred to in this warning notice.

Further assistance

For guidance on conduct issues, contact the Professional Ethics Team.

Print page to PDF