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The truth about 'no win, no fee'
Q8 Can you give me some examples of how charges can be levied or disguised?
Sometimes, a personal injury claims specialist (if they are not themselves a solicitor) will not directly charge you anything themselves, but will allow the solicitor they appoint to make various deductions from your compensation award.
‘By law, some charges have to be included in the agreement, but that does not mean the solicitor has to levy them on you!’There could be any number of deductions contained in your ‘no win, no fee’ (called a ‘Conditional Fee Agreement’) arrangement with your solicitor. By law, some of these charges have to be included in the agreement, but that does not mean the solicitor has to levy them on you!
Remember – a good personal injury claims specialist will ensure your appointed solicitor will confirm in writing to you that he will not charge you anything or make any deductions from your compensation.
By the same token, others may make no such arrangement and you could be liable for:
1. Unrecovered insurance premiums
Too many personal injury claims specialists will say to their client, "Don't worry, the Access to Justice Act says that the cost of the insurance is payable by the other side, so you won't have to pay". It does say that, but the amount can be contested and it will be if is too expensive. So, a personal injury claims specialist or solicitor might buy the insurance at, say, £300, gross it up to £1000, and try to recover £1000 from the defendant. Of course the court rejects this, so the solicitor or specialist then deducts the £700 from the claimant’s compensation.
2. Interest on the loan
This is definitely not recoverable so, if you are persuaded to sign a loan, there will be interest to pay. Some personal injury claims specialists may suggest that they will pay it; they may even offer to put this in writing. Even so, in these circumstances, the contract would still be a direct one between you and the lender.
3. Unrecovered success fees
The solicitor appointed by your personal injury claims specialist is entitled to charge a success fee under the terms of the Conditional Fee Agreement ('no win, no fee'). This is represented as a proportion of the cost of bringing the case to court (which should be in line with how difficult or risky the case is). These costs are payable by the other side but, as with the cost of insurance, it can be challenged. Often it will be made artificially high so as to try to recover the fee that the solicitor has paid to the personal injury claims specialist who appointed him. Again, if challenged, and they nearly always are, and only part of these costs are recovered, the shortfall could be deducted from the compensation. Here is an example of how this might work:
Compensation figure awarded £2000
Solicitor’s costs £1200
Success fee sought at 30 % £300
Court only allows an award for success fee at 10 % i.e. £120
Shortfall (£300 - £120) deducted from client’s compensation £180
Actual compensation figure received 1,820
By law, a Conditional Fee Agreement ('no win, no fee') has to show charges that could be levied on you. But that does not mean the solicitor has to levy them on you! Remember, it is how the solicitor chooses to exercise this right that counts. A personal injury claims specialist and the solicitor he nominates for your case who meet the ClaimsGuide recommended criteria will both make a separate agreement with you that your solicitor will make no deductions from your compensation, regardless of the Conditional Fee Agreement’s wording
The truth about 'no win, no fee' |
Got a question that isn’t answered here? Want to ask an expert? Here At ClaimsGuide, we think there are 10 key questions you should consider asking any personal injury claims specialist you are thinking of dealing with. Get the right answers and you’ll know you’ll be dealing with someone who is going to look after your claim in the best possible way. Show me the questions What are the ClaimsGuide recommended criteria for choosing a personal injury claims specialist? Show me the checklist Show me the list of personal injury claim types Are you ready to claim through a personal injury claims specialist who meets the ClaimsGuide recommended criteria - that is, can answer all 10 questions in a way that satisfies us? Here |