After The Event Insurance – Effect On Litigation And Security For Costs Applications

A recent High Court case has considered the effectiveness of an 'after the event' insurance policy ("ATE insurance") in the context of a security for costs application (Greenclean Waste Management Limited v Maurice Leahy Practising under the Style and Title of Maurice Leahy & Co. Solicitors [2013] IEHC 7). It concerned a professional negligence claim by the plaintiff company that the defendant solicitors failed to advise on the extent of the plaintiff's obligations to make certain reparations under a lease, failed to advise the plaintiff in relation to a relevant limitation period and to disclose a relevant conflict of interest.

An application was brought by the defendant for security for costs under section 390 of the Companies Act 1963 where it was mutually accepted that the plaintiff was "hopelessly insolvent" although the plaintiff had ATE insurance to ensure the defendant was paid its party and party legal costs, in the event that the plaintiff was unsuccessful