Lawyers are anticipating a new wave of litigation related to the Covid-19 pandemic over the next two years, a new survey has found.
The London Solicitors Litigation Association (LSLA), which represents the capital’s main litigation practices and law firms, found that 78 per cent of lawyers questioned expected a rise in Covid-related claims.
The study found that 84 per cent of lawyers expected more Covid-related contractual disputes to surface, including wrangles over supply chain disruption caused by the pandemic, and that 70 per cent expected more insolvency-related cases.
It also found that 50 per cent expected more lawsuits linked to business interruption insurance claims — usually relating to whether insurance policies should have paid out over pandemic lockdowns.
London’s High Court has already been dealing with a number of these lawsuits — particularly stand-offs between hospitality groups and insurers.
In February Wolseley owner Corbin & King, now controlled by Thai hotel group Minor, won a closely watched £4.4mn business-interruption lawsuit against insurer Axa over the scope of its cover in a ruling that is likely to prompt other companies to bring fresh claims.
The UK’s largest pub group Stonegate is also suing a trio of insurers for £845mn losses it suffered during the pandemic.
Nicholas Heaton, new president of the LSLA and partner at law firm Hogan Lovells, said: “People did expect more litigation in areas like supply chains and contractual disputes because of the major impact on the economy caused by the pandemic. It’s been held back a bit but is now starting to materialise. The war in Ukraine has only added to the difficult economic conditions.”
The LSLA study, which questioned 110 senior lawyers in December and January — before Russia’s invasion of Ukraine — also showed that 57 per cent of lawyers expected an increase in Brexit-related lawsuits — particularly in areas such as employment and regulatory issues.
London’s High Court attracts litigants from all over the world because of its reputation for impartiality and high-quality judges, and there had been concern that once Britain left the EU many litigants would choose to bring their disputes in other jurisdictions, such as Amsterdam.
However, two-thirds of lawyers said they did not expect a flight of litigation work from London to other jurisdictions because of Brexit.
The report also reflected the increasing focus by law firms on the mental wellbeing of their staff as they battle to retain young lawyers who have reported rising rates of stress because of increased workloads over the past two years resulting from the M&A boom.
Law firms have been offering wellness schemes and fitness club memberships to help retain junior talent and stop lawyers leaving in droves.
The LSLA study found that 73 per cent of lawyers believed their firms had improved their approach to mental health in the past year, with 63 per cent believing their firm’s approach to diversity and inclusion had got better.