A while ago my partner had a cycling accident as a result of a poorly maintained road, which resulted in a broken wrist requiring surgery. There were no other people involved - just a very uneven road surface that was not visible from a distance, and which was in the right hand lane that he was forced to cycle down due to road works in the left hand lane (it was a temporary traffic light situation).
His surgery and subsequent physio was covered by the health insurance he has through work (he was originally supposed to have emergency NHS surgery, but it was rescheduled so many times that he nearly missed the window after which bones can heal incorrectly, at which point we realised his insurance could cover it).
He has been advised that he could likely claim for personal injury (against the council) due to condition of the road, which caused his accident. He has been in touch with a personal injury law firm, who are encouraging him to sign with them on a no-win-no-fee basis, but is feeling quite iffy about it because it has been hard to get straight answers on some points that seem quite key to whether or not it would be worth it for him.
One of these points concerns the interaction of the following two things:
(1) In the event of a "win", my partner would need to pay a maximum of 25% of the compensation value + VAT (it is apparently guaranteed that it would be capped at this amount, even if the lawyers' fees exceeded this amount).
(2) His health insurer has a policy that requires him to include their costs (for his treatment) in any personal injury claim he makes.
My question is this: assuming the health insurer's costs are covered by the compensation, who is liable for the proportion of the lawyers' fees corresponding to those costs? Or put another way, is there a scenario in which my partner could end up out of pocket, e.g. if the sum total of the insurer's costs and the lawyers' fee for the overall claim exceed the compensation amount?
As an example, say the medical costs (paid by the insurer) were £8k, and the compensation awarded after a successful claim was £10k, then unless there's something I'm misunderstanding, my partner would need to pass on that £8k to the insurer, but he would also need to pay 25% of £10k + VAT = £3000 to the lawyers, which would mean he would be out of pocket by £1k, despite a successful claim.
Can anyone clarify the situation, because we haven't been able to get any clear answers on this - just assurances (not in writing) that my partner "won't end up out of pocket".