Understanding the Expected Changes in the Scenario of the Contingent Fee System

At a time when accidents are decreasing in number but injury claim cases are mushrooming at an inverse ratio, the no win no fee solicitors are now being pointed the finger at for this abnormal increase in claims cases. But the importance of these solicitors cannot be ignored in a welfare state like Britain. Legal services have become accessible more than ever before. Accident victims have now been enabled to claim for their uncalled-for losses and damages by filing the car accident claims, the workplace accident claims and so on. Special arrangements are being made for the victims in debt. Legal researchers predict that the no win no pay lawyers who have strong work ethics and maintain transparency in their transactions will be able to survive in the future. Major tort reforms are underway and it is a good time to analyze their serviceability in 2013. Also how these solicitors work currently is assessed here below.

What’s in ‘no win no pay’?

It is a general tendency of any consumer to fall for free offers, special discounts and other sorts of offers where he needs not to expend much. In the UK, no win no fee is often interpreted as an almost free service which is absolutely watered down a perception. It is true that the solicitor won’t ask for his fees if the case is lost. But there are several accompanying costs that one should have a clear understanding of before entering a contract of this type. The other truth is, there are several other ways to fund a compensation claim lawsuit. But the no-win-no-fee way is chosen by most of the accident victims because it is the safest and most advertised way of filing claim lawsuits. A brief outline of how these solicitors charge can be found here below.

How these contracts work?

No win no fee solicitors work on the basis of Conditional Fee Agreements (in the US, these contracts are known as Contingency Fee Agreements). These contracts are signed between the plaintiffs and the solicitors. It has to be understood that if your case is lost, the solicitors won’t charge their fees but they will be eligible to recover associated costs. For example, if your solicitor paid for your medical treatment, he will recover the cost from you. However, you don’t have to pay the solicitor in cash under any circumstances. Your insurance company will pay that on behalf of you and it will be added to your premiums. On the other hand, if you win the cases, the other party will pay the legal costs and all other costs incurred on you. You just need to pay success fees to your solicitor. Success fees vary depending on the probability of winning a case.

After the Event arrangements

‘No win no fee’ arrangements won’t work without proper legal insurance coverage. If you opt for an agreement like this, you get protected from paying the solicitors fees. But paying the legal cost of the opponents also comes essential in case of losing cases. If there is not BTE (Before the Event) insurance coverage, you should opt for After the Event plans. Your solicitor can make necessary arrangements for you. ATE plans work just like CFA. You won’t have to pay the premiums and once you win the case, your opponent will pay for these premiums on behalf of you. You should check with your solicitor whether your existing insurance coverage will suffice for filing a lawsuit or you have to opt for an After the Event insurance plan.

Part 36 offers-What’s in it?

If your compensation claim case goes to the court and the losing party is instructed by the court to pay you compensation, they will also have to the legal costs. The Citizens Advice Bureau explains these things in a more explicit manner. The Civil Procedure Regulations 1999 defines how a court case can be averted and an out-of-court settlement can be made. Part 36 of the regulation provides a framework for this. Any of the two parties involved in compensation claim litigation can offer out-of-court settlement before a case goes to the court. This is called Part 36 offer. However, it has to be kept in mind that this type of offer does not prove that the other party is admitting his liability. It must be accepted within twenty one days from the date of the offer. Post that period, the defendant may withdraw his offer.

Should you go for party 36 offers?

Or should you go for an out-of-court settlement? Your solicitor who you appoint on a no win no fee basis can explain this better for you. If your solicitor quantifies your losses and injuries and give the offer a nod, you should not go for a court case as because court fees are fairly high in the UK. For each hearing, you have to pay separately. If negotiation is possible, then why should you risk your money by going to the court? Instead, you should follow your solicitor’s advices and act accordingly. Keep in mind that you still have to pay the solicitor his basic fees and success fees if you get a lesser amount than what is offered to you in an out-of-court settlement. Chances are there that the entire compensation payout awarded to you will be drained out to pay the legal fees and other costs. Therefore, you should know where to put a stop and you should trust your solicitor in this regard.

April 2013-The month in which no-win-no-fee rules will change

Sir Rupert Jackson (honorable Lord Justice Jackson who chairs in the Court of Appeal) produces a report in 2009 which unambiguously asserted that the current no-win-no-fee laws encourage unscrupulous activities. The report pointed out that there are some no win no fee solicitors who take trivial accusations to the courts as they know that they can recover their fees under all circumstances. The proposed reforms are aimed at curbing these issues. Next year onwards, winning parties need to pay the Success Fees (Max 25% of the awarded compensation payout) and won’t be able to recover ATE insurance premiums from the losing party. Legal researchers and experts predict more competition among the no win no charge solicitor which will benefit the claimants in a manner as the solicitors will aim to keep their Success Fees as low as possible for getting more clients.

Whether you have been involved in a road traffic accident or a workplace accident, consult with expert no win no fee solicitors about these issues and know more about how to file compensation lawsuits.