Personal Injury, No Win No Fee, Contingency, Conditional...What's It All About?

When a member of our staff was flicking through her child's school citizenship book, she was somewhat surprised to discover the book suggested it was possible to pursue a personal injury claim on a 'contingency fee' basis. This gives the impression that if you pursue a case on a 'no-win, no-fee' basis your lawyer will take a proportion of your compensation to pay his costs. In reality, a UK personal injury claim is assessed on a 'conditional fee' basis. The problem seems to be that not only do they sound similar, but, to many of us, the concept is also similar, especially as the result is the same: you receive compensation and the lawyer gets paid. They are both examples of 'no-win, no-fee' agreements. But they are different, the most obvious difference being that contingency fee agreements are illegal for personal injury cases in the UK and are primarily an American idea.

What is the difference?

If you suffer a personal injury in America, you may employ a lawyer on a ‘contingency fee’ basis. This means you pay nothing until the case is won. If it is won, you must then give away a large proportion of your compensation to pay for your lawyer’s costs. If your lawyer fails to win the case, you haven’t received any compensation and therefore don’t have to give him a penny. There are clear advantages to claiming: you receive more money than you would have if you hadn’t made the claim in the first place, and the lawyer doesn’t lose out on his legal costs either. Obviously the lawyer wouldn’t have taken the case if he didn’t believe he could win it, and therefore if he loses it is not your fault and you do not have to pay for his services. An American lawyer, at the end of the case, will take as much as 50% of your compensation, whereas no UK lawyer would take that much.

So what does the UK have? Something better!

The UK has what is known as a ‘conditional fee agreement.‘ It is a fairly similar process, the exception being you will receive 100% of your compensation and keep it! You won’t have to pay your lawyer a thing. Like the American system, a lawyerwill review your case and only take it on if he believes it has prospects of winning. If the case is lost, you pay nothing. If it’s won, you pay nothing. The solicitor covers his legal costs from the other party. For example, you have been involved in a car accident, where Mr ‘I-was-driving-using-a-mobile-phone’ decides to smash into the back of you, and you are driven away from the car in an ambulance with a broken leg and severe whiplash. You then seek the advice of a lawyer who assesses the claim. The lawyer believes you have a good claim and agrees to act on your behalf. You are successful, you win the case, receive your compensation and the lawyer recovers his costs from the man-who-wasn’t-paying-attention’s insurance company. This man’s insurance premium goes up, but you don’t lose out and your lawyer doesn’t take a penny of your compensation.

But I know contingency agreements are used in the UK

Contingency fee agreements are not used for personal injury cases, but can be used in other areas of law. If you have an employment case you may employ a solicitor on a contingency fee basis. This is because there are no costs in an employment tribunal. For example, if you believe your employer has discriminated against you at work, and a solicitor agrees with you, they may arrange to take the case on the agreement that if you win, you pay your solicitor’s costs. Your employer will give you compensation, but they’re not going to give your solicitor any money for winning the case. Therefore you must part with some of your compensation to cover the legal costs.

Contingency fee agreements can also be used in criminal injury cases. Again this is because you can’t get costs in this sort of case. It is available to the victims of violent crime, as long as the violence was incidental to the crime. If you were an entirely innocent bystander at a bank robbery and were shot in the chest, you will be entitled to compensation for the injury.

I think I have a case...

If you think you have a no-win, no-fee claim, call Gray Hooper Holt. We provide a free half-hour initial advice service over the telephone, which allows us to make a preliminary assessment of your case. If we believe you would be successful in a claim, we’ll take your case and get the ball rolling. If not, you haven’t lost out financially and can even escape the cost of the telephone bill by filling out our online enquiry form and letting us call you.

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