No Win No Fee
All About No Win No Fee
Taking legal action is a complex and daunting prospect and one which the average person shouldn’t really even consider pursuing on their own. Collecting evidence and building a case will require expert and costly help and before the advent of the so called ‘no win no fee’ system, access to justice was limited to those who could afford it. Legal aid was paid to some people, but it was rationed and strictly means tested, and being too well off to get legal aid was in no way the equivalent of being wealthy enough to fund your own case. No win no fee was designed to bridge this gap and widen access to justice.
The proper term for ‘no win no fee’ is Conditional Fee Arrangements and they were introduced, in a more limited form, via the Courts and Legal Services Act 1990 (Section 58) but didn’t start to be used until 1995.
The basics facets of the system were as follows:
- No money had to be paid up front.
- Your no win no fee solicitor only received a fee if you won your case.
In the early years of no win no fee, the ‘success fee’ – the money paid to your no win no fee lawyer if you win – had to be taken from your compensation rather than from the losing side of the case. The Access to Justice Act 1999 changed this, however, replacing any legal aid in personal injury cases with the fully fledged no win no fee system, under which a lawyer’s fee would be paid by the losing side.
If you were unlucky enough to lose your no win no fee claim then insurance taken out would cover any costs claimed by the other side. The system meant that risk was removed from making a claim and rather than worrying if you could afford to seek justice, you merely had to decide if you’d been a victim of negligence and then contact no win no fee solicitors to handle your case.
Changes to no win, no fee in 2013
By 2008 a conception had grown that the ‘compensation culture’ was running out of control in the UK. Whilst statistics showed a steady but relatively small rise in the number of actual claims the focus of certain sections of the media had created an impression of a much more litigious society, and this has led to public bodies and businesses feeling hidebound by the risk of being sued. Ironically, it was the conception rather than the reality which was seen to be the problem, but the government still opted to make changes.
In a study conducted by claims.co.uk, a staggering 81% of respondents said they believe that a compensation culture exists in the UK. However, evidence clearly shows that there has been a reduction in compensation claims over the last ten years. In 2013, a report by health and safety journal Hazards revealed that compensation claims for work injuries and industrial diseases have fallen significantly since the start of the millennium.
For over a decade, the no win no fee system has been the basis for making personal injury claims in the UK. This video explains the basics of how no win no fee works.
The Jackson Report
In 2008 the Master of the Rolls asked Lord Justice Jackson to look into the situation regarding personal injury compensation and no win no fee claims. After twelve months of investigation he published the Review of Civil Litigation Costs, more commonly known as the Jackson Report. His main recommendation was that success fees should no longer be paid by the losing side, but should instead be taken from the compensation awarded, with no win no fee solicitors able to take a maximum of 25%. In an attempt to offset the effects of this he also recommended an across the board increase in general damages of 10%.
The timeline for the new legislation runs as follows:
- 2008 – Master of the Rolls, Lord Clarke of Stone-cum-Ebony asks Lord Justice Jackson to review the costs of litigation.
- January 2009 – Lord Justice Jackson begins his investigation.
- January 2010 – the Review of Civil Litigation Costs is published.
- October 2010 – Lord Young of Graffham produces Common Sense Common Safety for Prime Minister David Cameron. This report into health and safety and the compensation culture, despite stating that the ‘compensation culture’ is largely a media creation, suggests implementing the recommendations of Lord Justice Jackson.
- April 2013 – the Legal Aid, Sentencing and Punishment of Offenders Act 2012 comes into force, enacting the changes in conditional fee arrangements. (gov.uk)
What happens if I lose my claim?
In the unfortunate event that you lose your claim, you will not be awarded any compensation. On the bright side, under a no win no fee agreement, you won’t be responsible for paying your legal fees. Your injury solicitor will have insurance in place to handle instances such as this.
You gave it your best shot and you should hold your head up high! At the very least, you won’t be left wondering what could have happened.
What happens if I win my claim?
If you win your claim, you still don’t pay legal costs. However, you may be liable to pay your solicitor’s success fee, up to a maximum of 25% of your compensation (as described above in the changes to the no win no fee system).
- CFA (Conditional Fee Arrangement) – system under which you pay nothing when pursuing your claim, and only pay a ‘success fee’ if your claim is successful. This fee will be no more than 25% of the compensation awarded.
- ATE (After the Event) Insurance – If you lose your case you will have to pay the costs of the other side. Insurance taken out at the start of the process will cover this cost, meaning there is no danger of you suffering substantial legal fees.
Are you ready to receive expert legal advice without emptying your bank account? Complete our online claim form or give us a call to discuss your claim today with our no win no fee lawyers!