Scenatios – Why you need a no win no fee agreementLorraine had a motorcycle accident. There was a dispute as to whether it was the other driver’s fault or Lorraine’s. Lorraine went to see her solicitor and due to her earnings was not eligible for legal aid. The solicitor advised her that he was willing to take on the case and he would require a payment on account of costs for £1000. He explained to her that in the event that she lost, this money would not be recoverable. In addition if she won and he could not agree the full amount of his costs from the defendant she would have to pay that sum out of her compensation. Luckily Lorraine won her case but had to pay a further £300 for disbursements which had not been recoverable form the defendant. Lorraine obtained in total £1500 but out of this sum £300 was deducted. A “no win no fee” scheme would have meant that Lorraine would not have risked the possibility of losing the £1300 she paid the solicitor. In effect the solicitor would have been taking the risk. Depending on which claims management company or solicitor Lorraine had given her case to, she may have still been liable to pay a part of her compensation to them. However, if she had chosen a firm which advertised 100% compensation with no costs she would have recovered the full £1500. Barry was out shopping when he walked into a glass door panel, severely disfiguring his face. Barry went to see a solicitor. The solicitor asked Barry for £1000 on account of costs. As the case progressed and the defendants were not admitting liability the solicitor asked for a further £2000. The case went to trial and Barry lost. Due to the fact that Barry was not under a “no win no fee” scheme he lost £3000. He also had to pay £2000 for the opponents. Does “no win no fee” mean you are liable at no stage? In fact “no win no fee” only applies to your solicitor. The agreement does not cover:
However this situation only arises once your solicitor issues proceedings. Prior to proceedings the defendants cannot claim any costs. So what can you do to protect yourself and ensure that “no win no fee” means that at no point will you be faced with a bill. |
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