Right Question, Wrong Forum: Clients Chasing Secret ATE Commissions Must Seek an Account

The decision in Turner v Coupland [2026] EWCA Civ 1204 is an important one, not just because it restricts what can be dealt with on a solicitor and client assessment under the Solicitors Act 1974 but also shows that the issues surrounding secret commissions within after the event insurance policies are not going away.

The claimant in this case was the former client of the solicitor, Coupland Cavendish Limited, trading as Gowing Law.  The solicitors represented Mr. Turner in a low value road traffic claim, which settled pre-proceedings for £3,000. An ATE policy was purchased by Mr. Turner via Gowing Law which provided some insurance against the risk of paying the other side’s costs.

Upon settlement, the solicitors delivered a bill totalling £7,944, which as the court noted was “more than twice the damages recovered, and almost four times the amount of costs recovered under the settlement” [§14]. Mr. Turner issued a Solicitors’ Act application for an assessment of the profit costs and success fee, via his new solicitors JG Solicitors Ltd.   As is required by the CPR (and specifically CPR 46.10) the solicitors delivered a “cash account” to him which set out all payments made and received in respect of the case, whether they were included within the bill or not.  The ATE premium was included within the cash account.

The claimant asked Part 18 questions of the solicitor, which included questions of whether there had been any commission paid as part of the premium.   The solicitors refused to answer.   At a first hearing, the now Senior Costs Judge refused to make a Part 18 order on the basis that Mr Turner had failed to show that there was any evidence that a commission had been paid and in the absence of a “positive case” the order should not be made.[1]

Mr Turner appealed.  Mr. Justice Sweeting allowed the appeal and made the order.  He found that an applicant under CPR Part 18 was not required to make out a “positive case”. Rather, the only requirement was that the request relate to a matter in dispute within the proceedings, must be proportionate and not a “fishing expedition”.

The Court of Appeal therefore addressed whether the ATE as contained within the cash account was a matter in dispute within the Solicitors’ Act proceedings.  The court concluded that it was not and the appeal was allowed.

ATE premiums were always included within solicitors bills of costs as a solicitors’ disbursement. However, in Herbert v HH Law Ltd [2019] EWCA Civ 527,  the Court of Appeal determined that they were in fact a client disbursement; while they are purchased by the solicitor as agent for the client, the contract was between the client and the insurer.   Thus, they should be included within the cash account but not the bill of costs.  As a result, they are not part of the assessment itself.

The Court of Appeal determined in this case that while the costs judge is required to certify the cash account, that only relates to matters which are the subject of the assessment itself.  The assessment is concerned with, in the Court’s words “how much the solicitor should be paid for their services” [§71].  Andrews LJ in delivering the judgment of the Court of Appeal gave this conclusion on the point at [§99]:

“It is not necessary, nor indeed permissible, for the costs judge to resolve issues about items on the cash account, or items which (if they existed) should have appeared on the cash account, which cannot be treated as payments made towards the costs which have been assessed. A dispute concerning an item in the cash account which is irrelevant to the determination of how much the solicitor has already received in respect of his assessed costs is not a “matter in dispute in the proceedings” nor is it something that the costs judge has the power to adjudicate upon as part of the certification process following assessment.”

To the extent that Ritchie J had decided otherwise in Edwards and others v Slater and Gordon UK Ltd [2022] EWHC 1091 (QB), he was wrong.

Where are we now?

That is not the end of the matter.   There are a multitude of cases where solicitors who act for former clients in costs claims are seeking information as to whether secret commissions have been paid as part of ATE premiums in low value RTA claims.   This case makes it plain that this issue is extraneous to a solicitor and client assessment.  It does not, however, put the matter to bed.

Andrews LJ was highly critical of the solicitors in this appeal for refusing to answer questions regarding whether a commission had been paid. She described the solicitor’s refusal as “unattractive”, “unwise” and “unedifying”, commenting that:

“If they did not receive a commission, it would be simple enough to give the client express confirmation if they ask for it. Refusing to do so simply reinforces suspicion, and, on the face of it, would justify the client in seeking an account (for which the Solicitors might end up having to pay the costs, since their refusal to answer could well be considered unreasonable)”.

The judge concluded by noting that although a client cannot seek answers by way of Part 18 questions in Solicitors’ Act proceedings, “as a fiduciary, the solicitor ought to tell them if they ask” [§102]. The court did not conclude that the client was not entitled to the information sought – rather, the court concluded that they are simply not entitled to the information through Solicitors’ Act assessment proceedings. The solicitors’ obligations as a fiduciary remain unscathed.

Notably, Andrews LJ also indicated that Mr Justice Sweeting was “right to identify the unfairness of requiring the client to produce evidence that a commission was paid in order to obtain the evidence they need to prove it” and flagged this as an issue for rule makers to address [§102].

Irrespective of any change in the law, it now appears that a former client who asks such questions of their solicitor will be entitled to an answer.  If no answer is provided, the client will be able to bring a claim for an account; this will be far more expensive than dealing with the issue within the confines of a Solicitors’ Act assessment.  A solicitor who unreasonably refuses to answer is likely, considering Andrews LJ’s guidance, to have to pay the costs of any such claim.

Thus, far from conclusively determining the underlying issue, this appeal simply sets out that where a secret commission is suspected, a Solicitors’ Act claim is not the method by which the client can obtain the information they seek.    It also makes it clear that solicitors are not able to avoid answering such enquiries.   For a client, it matters not in which context they are able to obtain answers; it only matters that they receive the information they seek.  This decision makes it almost impossible for the solicitor to avoid the issue.

Robin Dunne and Priya Gopal acted for Mr. Turner in the Court of Appeal.

[1] Interestingly, the actual Part 18 request was not before the costs judge at this hearing, which was another reason he gave for refusing to make the order.