Lawyers accused of exploiting tenants as council wins third disrepair case in costly legal rout
A law firm has been publicly condemned as “borderline negligent” after it failed to defend a housing disrepair claim, leaving its client facing a £9,414 court bill.
City of York Council, which prevailed in the county court action, revealed that the unnamed firm advertised itself as operating on a “no win, no fee” basis. But when the case collapsed, it wasn’t the solicitors who took the hit—it was the tenant.
The case centred around claims that a rented property had issues with mould, damp, and plaster damage. Yet, according to the council, the case fell apart under scrutiny, one in a string of failed legal actions brought by similar firms. The court gave the solicitors 14 days to explain why they shouldn’t foot the bill for their own mishandling.
Michael Pavlovic, York’s executive member for housing, planning and safer communities, didn’t hold back. “This is the third failed housing disrepair claim made by no-win, no-fee solicitors resulting in tenants being ordered to pay many thousands in costs,” he said. “These claims divert time and money from tenants’ homes.”
Pavlovic urged residents to bypass legal firms entirely. “Talk to our officers,” he said, “not lawyers.” He insisted that the council had an ongoing campaign to address tenant concerns directly and to fix problems before they escalate into expensive courtroom drama.
This case is only the latest in a growing crisis surrounding bulk housing disrepair litigation. Authorities have reported a surge in claims filed by high-volume legal firms, many of which collapse under legal challenge, leaving tenants, not solicitors, holding the financial bag.
Embed from Getty ImagesThe issue has grown so serious that the government and Solicitors Regulation Authority (SRA) have held two emergency meetings in the past month to address concerns over these litigation practices. One of the biggest warning signs: clients of the now-defunct Sheffield firm SSB Law have been left facing thousands in defence costs, despite being assured they wouldn’t owe a penny.
Across the country, more than 80 investigations are underway involving 74 firms. The SRA believes these cases involve over 200,000 potentially faulty claims, ranging from housing disrepair to mis-sold financial products and cavity wall insulation.
A May report by the Civil Justice Council (CJC) painted an even darker picture. It described how some firms had built unstable, high-risk business models backed by “portfolio funding.” These models, the report said, depend on unreasonably high returns and often fail to protect clients from financial fallout.
Worse, the CJC raised doubts about whether law firms had carried out proper due diligence, or even explained the risks of legal funding and insurance to their clients. Some firms may have recruited clients using opaque or misleading methods.
It’s a situation that risks becoming a full-blown regulatory scandal. The CJC has now urged the government to launch a sweeping investigation into these portfolio funding models and consider imposing stricter rules to stop similar exploitation.
Meanwhile, tenants across the UK remain vulnerable to legal tactics that promise easy wins but deliver devastating losses.