Construction Disputes Insurance Product

Enforcing Adjudicator’s Decisions in Construction Disputes

Temple have developed an ATE insurance product that plays a vital part in assisting insolvent building sub-contractors in enforcing adjudicator’s decisions.

Now that “anti-adjudication” injunctions have been consigned to history due the Supreme Court’s landmark decision in Bresco Electrical Services Ltd (In Liquidation) (Appellant/Cross-Respondent) v Michael J Lonsdale (Electrical) Ltd (Respondent/Cross-Appellant) [2020] UKSC 25 , the question still remains, how to enforce the adjudicator’s decision given the insolvent status of the referring party?

This problem was addressed in the case of Meadowside Building Developments v 12-18 Hill Street Management [2019] EWHC 2651 (TCC). The Court stipulated that among two other measures, an after-the-event insurance policy is required in these types of case, providing adequate security for the responding party’s costs in (1) defending any summary judgment application and (2) prosecuting any final determination proceedings challenging the adjudicator’s decision.

Temple’s specialist insurance product has been designed specifically to provide cover for these two risks.

The policy was the subject of a great deal of scrutiny by the judge and the opponent’s Counsel in a case we underwrote in which our insured was ultimately successful [ Balfour Beatty Civil Engineering Ltd v Astec Projects Limited (In Liquidation) [2020] 796 (TCC)]. It has been found fit for purpose.

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Bespoke Underwriting

For complex cases, our experienced team provides quick, commercial decisions to get your funding in place.

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Wilson Browne Solicitors have a long-standing arrangement with Temple Legal Protection to provide litigation insurance cover for our property litigation clients. It is extremely straightforward to use, the policy quite simply works and it is comforting for clients to have the option of disbursement funding in addition. All in all the whole thing is a bit of a ‘no-brainer’, especially for clients who are naturally concerned about the financial risks when undertaking litigation. Once in place the policy gives both us and clients great peace of mind: it allows us to get on and deliver on our promise of being “all the help you need.

Kevin RogersWilson Browne Solicitors

We and our clients have used Temple for ATE insurance on many occasions. Most recently we acted for a liquidator pursuing claims to recover assets for the liquidation estate. After lengthy and heavily contested litigation, ultimately settlement was achieved at mediation. That settlement was only possible with the assistance of Temple’s direct, pragmatic and commercial approach. This was much appreciated by both us and the client.

Matthew KellyFreeths Solicitors

Temple Legal are brilliant. Jamela and her team have a deep understanding of litigation and legal risk. They are responsive to client requirements throughout and have developed a user-friendly platform for case updates.

Securing ATE insurance cover from Temple Legal provides enormous comfort to libel defendants. It is a key factor in their decision to defend claims against them as it insulates them from the risk of paying opponents’ legal costs.

We look forward to working with Temple Legal again soon.

David RomainEgality Law LLP

Resources & Downloads

Access the technical documents and application forms you need to secure ATE insurance and disbursement funding for your clients

Commercial Client Guide Commercial Proposal Form

Commercial Disbursement Funding Guide Commercial Solicitor Application Form

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Common FAQs

Some of the key questions about construction disputes.

What risks are covered?

Opponent’s costs and insured’s disbursements in respect of (1) summary judgment application and (2) final determination proceedings.

What is the level of indemnity?

This will depend, but typically in respect of risk 1 – summary judgment application- £50,000 and in respect of risk 2- Final determination proceedings - £150,000.

Can the level of indemnity be increased?

Yes- subject to no material adverse deterioration in the merits of the potential claim or defence.

When can an application for insurance be made?

Once the adjudicator has issued his decision in favour of the insured. The adjudicator’s decision must cover the entirety of the insured’s dealings with the responding party and the decision must be regarded as not being defective or erroneous in any material respect.

At what point is the litigation insurance policy purchased?

The litigation insurance policy is purchased after a legal dispute arises. The best time to send a case to us is as soon as you have been able to adequately assess the merits of the claim. Usually, this is after your investigation and the pre-action correspondence has been completed, and before proceedings are issued. However, cases can be referred to us at any stage.

When is the premium payable and how is it calculated?

The premium is calculated as a percentage of the level of indemnity of each risk insured. The premium is fully deferred until settlement or judgment and only payable if the insured is successful in its claim and or defence. If neither of the risks are engaged and the responding party pays the adjudicator’s award without the need for issuing a summary judgment application, then a premium becomes payable based on a percentage of the aggregate level of indemnity for both risks.