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BMIF premiums for civil fraud

The Association has received a letter from the Bar Mutual Indemnity Fund dated 11 January 2013.  the text of the letter is as follows:

"Dear Mr Fancourt

Allocation of Fee Income from Civil Fraud Work for Rating Purposes

I write to draw the Chancery Bar Association's (and its members') attention to an important clarificatory amendment to how Bar Mutual rates fee income deriving from civil and commercial fraud work.  This change is being introduced for the forthcoming renewal for the 2013 policy year.

As the Association's members will know, the division between work that can properly be described as "Commercial" and work that can be properly described as "Chancery" has become increasingly blurred.   lt is now a commonplace for barristers practising from sets that traditionally have had practices that were "chancery" in nature to appear in the Commercial Court, for barristers in chambers traditionally seen as being "commercial" sets to appear in the Chancery Division and for the division of the High Court (Chancery  Division or Commercial Court) in which major civil and commercial litigation is issued to reflect no more than the personal preferences  of those instructed on behalf of the claimant.

Bar Mutual's underwriting and claims experience suggests that this blurring may have become especially common in commercial fraud disputes.  What appears to be happening is that those  who practise from chambers traditionally seen as "commercial" sets tend to declare fee income  from commercial fraud work as "Commercial" when completing their annual renewal form, even if the legal principles arising  in the case (such as dishonest assistance and the tracing rules) originated from the Chancery courts, while those undertaking the same sort of work from chambers traditionally regarded as  "chancery" tend to declare it as "Chancery: Contentious". In saying this, I must stress Bar Mutual is not suggesting the apparent difference in approach to fee income declarations is the result of anything other than innocent misallocation on the part of those barristers who declare the fees as "Commercial".

In order to eliminate the potential for any unfairness arising from this difference in approach, the Directors of Bar Mutual have decided that fee income deriving from civil and commercial fraud disputes should be allocated as "Commercial" for renewal purposes.

While we are sending letters to the Heads of the chambers most affected by this change, it would be much appreciated if the Association could draw this matter to its members' attention, perhaps by posting this letter on its website.

Thank you for your assistance.

David Simpson

for Bar Mutual Management Company"