An insured person's right under EU law to choose their own lawyer for any judicial or administrative proceedings relating to a contract for legal expenses insurance, extends to mediation as well as court proceedings, the EU Court of Justice has ruled.

The Third Chamber of the court gave the decision in a case referred from Belgium, in which two bar associations sought annulment of a 2017 law as infringing the constitution, read with Directive 2009/138 on Insurance and Reinsurance.

Article 201 of the directive provides that where, under a contract of legal expenses insurance, recourse is had to a lawyer to represent the interests of the insured "in any inquiry or proceedings, that insured person shall be free to choose such lawyer or other person". The bars complained that the law in question did not provide for the right to choose a lawyer in mediation proceedings, which were covered by the term "proceedings", and the Belgian court referred this question of interpretation to the Court of Justice.

The court noted that the objective of the provision was to provide adequate protection for the interests of insured persons. The term "proceedings" therefore "includes not only the appeal stage before a court in the strict sense, but also a stage that precedes those proceedings and which is capable of leading to a judicial stage".

If mediation were excluded, it would deprive the insured of their right to choose a lawyer for that stage only, yet such proceedings were "capable of determining definitively the legal position of the insured person".

Further, EU law itself encouraged the use of mediation proceedings, and "It would therefore be inconsistent for EU law to encourage the use of such methods while at the same time restricting the rights of individuals who decide to rely on those methods."

Click here to view the court's judgment.