No Win No Fee

[NGC2017]

Hi

Please can someone help me understand what the 25% fee is taken from? Is it 100% of the settlement agreed which includes damages and special damages (which I understand your medical costs fall within), or minus ATE and medical consultation/treatment costs and then their fee is taken?

Thanks in advance

It sounds like you have a damages based agreement rather than a traditional conditional fee arrangement and that it must be personal injury if there is a 25% in there.
www.dmhstallard.com/news/legal-updates/damages-based-agreements-is-this-seed-of-litigat

I do not do personal injury law so you probably need an expert to advise.

This might help from www.out-law.com/topics/dispute-resolution-and-litigation/litigation-funding/conditional-fee-agreements/

To compensate for the risk of not being paid fees in the event of the case being lost "and the success criteria not being achieved, save for appeal proceedings, the DBA fee payable for solicitors’ fees, counsel fees and VAT from monies recovered from the opponent will equate to a sum of up to 25% of general damages and pecuniary loss (other than future pecuniary loss) for a personal injury claim, and up to 50% of the sum recovered for all other matters (excluding employment claims). In respect any appeal proceedings there is no limit on the DBA percentage fee payable.

The DBA percentage fee for solicitor fees, counsel fees and VAT is paid by way of deduction from the sum recovered (damages) from the losing party."

Thanks for you response.

She has confirmed that the 25% fee is to be taken from 100% of the settlement amount. The ATE is separate.

I am certain I have entered into a CFA. I will have to check but I had never heard of a DBA until your post.

Entering into an agreement where I am liable for a 25% fee following a successful settlement isn't a problem to me. I just feel it is unfair taking 25% of all the medical consultations and medication and treatment when I have been put in the position by someone else. That part has surprised me as it hasn't been explained before. I was led to believe that the medical side was a separate thing

I am certainly not an expert. Damages based agreements have not been at all popular and not much used so you may well have entered into a CFA in which case I thought the system was that if they lost your lawyer gets not a penny (one reason I would never do work on that basis - far far too risky) and if they lose they can charge in most kinds of cases double - the conditi8onal fee uplift which cannot come from the other side nowadays and has to come out of the damages as much the insurance premium and that that change made conditional fee agreements much less easy to operate for smaller value cases. If you win £80m as we were seeking in one of my cases and your insurance premium comes out of the damages then it is no big thing nor that half the costs come out of it either. If you are seeking £10k then it might mean instead you don't win a penny once the costs and insurance is paid. Personal injury probably have its own special rules however so I am not the person to ask.

Good luck with it all.

Thank you.

She has said it's 25 percent of the settlement agreed. I've had years of medical appointments, treatment and therapy and all these have been paid for by the other side. I was just never told that the success fee was including the medical part.
I guess it is what it is but I wish the information would have been mentioned up front

And it works the other way too - the solicitor might have a lot more costs than the 25% if the amount recovered is amall and VAT has to come out of that 25% and the barrister' s fees. It is not a simple system any more compared to the day when you paid the solicitor each month during the case and then if you won you got back a good proportion of your costs from the other person.

No personal injury lawyers have come along to answer this. Do check what the original paperwork said - some conditional fee agreements and damages based agreements would I would have thought should say what is included and what is not.

Thanks Xenia. I am definitely reading over the contract later when I get home.
I feel abit worried now as she has always said its 25% contribution and the ATE insurance on top. I really hope this is the case, as her fees far exceed what she is hoping to settle for

It is a really difficult issue. At least once a week someone wants me to sue and the sum is so low I don't take on the work as I don't believe in principle in ever doing a case where the legal fees might be more than the sum in dispute.

I'm a personal injury lawyer. The success fee can be applied to general damages (so the actual injury compensation, pain suffering loss of amenity) and past special damages, can't be applied to future losses.

So basically it is 25 percent of everything that has happened but not future losses? Doctors have requested a further 2 years recovery and that it will never completely go away

That's right.

General damages (injury) is in one chunk so past and future all in together.

It can't be deducted from future special damages, so if you're getting a sum for your treatment to continue for example nothing can come off that.

The 25% is a maximum, so it can be less. It's worked out by reference to the actual time spent by lawyer at their hourly rate and the percentage set out in the CFA itself (which will be based on a risk assessment carried out at the start of the claim). Your lawyer should be able to give you a breakdown of it.

Example...

Total compensation of £10,000 (for ease we'll say that's all made up of generals plus past specials)

Success fee percentage - 50%

Costs on hourly rate basis - £4000

Success fee would be (£4000 X 50%) = £2000. VAT then added and so total of £2400 is payable by you.

Example 2...

Total compensation of £10,000 (for ease we'll say that's all made up of generals plus past specials)

Success fee percentage - 100% (must have been a very risky looking case at the outset!)

Costs on hourly rate basis - £6000 (it was riskier as less straightforward so probably more arguments about liability for example)

Success fee would be...

(£6000 X 100%) = £6000

However, the law is that success fee must be capped at 25% and so only £2500 is payable (including VAT)

Hope that helps.

You should have been given reasons for % at the time you sign CFA (no win no fee agreement).

Wow. Thank you for this. So should all this be set out in the contract? I don't recall it other than it stating 25 percent which she said to me again to other day. I defo need to give it a read again as it proving more complicated than I thought. I just expected 25 percent to be payable at the end. I do know her costs last year we nearly as much as she is hoping to settle for, so now they will definitely be in excess of that

I have to be honest reading over the contract has confused me. She has always mentioned 25 percent so I have assumed this would be the case.

Sorry for the questions but in my head it's this. For ease:

Settlement accepted £10,000 so
The maximum they can charge is £2,500 success fee. Am I correct or in reality could it actually be more?

The only way it could be more would be if you took out an insurance policy (usually referred to as "after the event" or ATE policy) as the premium for that is payable on top of the 25% success fee.

Otherwise shouldn't be more than that assuming you definitely have a CFA (conditional fee agreement) not a DBA (damaged based agreement - unusual for most injury cases, I'd only personally use one for something like protection from harassment case).

That might be why I (non personal injury lawyer) was confused as that 25% sounded like what I think are very rare - damaged based agreements - % of damaged recovered rather than the much more common conditional fee agreements. Hopefully the agerement will make it very clear what kind it is - CFA or DBA.

Thank you both. It's definitely a CFA. I was told I had to take out the ATE policy so that's on top. I didnt know that that the 25 percent isn't due on future special damages

yes, the ATE policy is in case you lose and have to pay the other side's full costs which is one the biggest risks for people who sue someone else - that they won't will a penny and have to pay their own lawyers and the oer side's legal bills too. Those after the event policies cover that risk. I have only ever had one case with one of those but that is because I tend to act for big companies who can cover the costs of the other side if they lose the case without needing insurance to cover it.

Edith is the useful one on this thread as they do personal injury work.
Good luck with it all.

Thank you.

Liability has never been an issue. Was admitted from the start. Ifs juts gone of for so long due to lots of medical stuff