This Directive has been superseded by the newer general Insurance Directive 2009/108/EC, in which Articles 198 - 205 provide for legal expenses insurance in the same terms. The 1987 Directive was transposed into English law by the Insurance Companies (Legal Expenses Insurance) Regulations 1990 (“the Regulations”). The equivalent of Article 4 is Regulation 6 which provides:-
”Freedom to choose lawyer
(1) Where under a legal expenses insurance contract recourse is had to a lawyer (or other person having such qualification as may be necessary) to defend, represent or serve the interests of the insured in any inquiry or proceedings, the insured shall be free to choose that lawyer (or other person).
(2) The insured shall also be free to choose a lawyer (or other person having such qualifications as may be necessary) to serve his interests whenever a conflict of interests arises.
(3) The above rights shall be expressly recognised in the policy.”
The three respondents to this appeal had the benefit of legal expenses insurance (“LEI”) with the appellant insurance company Equity Syndicate Management Ltd (“the insurers”) and wished to bring employment and discrimination claims. The relevant terms of that insurance included the following:-