Litigation Funding – No Win No Fee

Commonly called a ‘no win no fee’, this is a Conditional Fee Agreement (“CFA”) with your legal team to assist you with funding your litigation. The purpose of the CFA is to have a separate funding arrangement in place so that instead of paying your Solicitor’s legal fees as you go, these are deferred and only become payable at a later date if you win your claim. Should you lose your claim, you will not need to pay your legal team’s fees. However, there is still a financial risk in respect of your opponent’s costs and other costs as your case progresses.

No

Whilst a solicitor’s practice may be willing to fund cases on a CFA arrangement, it is solely at the firm’s discretion, down to their assessment of the risk in non-payment and whether they are prepared to take it on.

It is rare that our litigation department will be able to run cases on a CFA basis where the value is less than £100,000 unless there are exceptional circumstances.

A win is defined as us getting you any benefit from your opponent (not every case involves a claim for money). That ‘win’ can happen before formal proceedings, by agreement or by an Order at a formal hearing. The terms of the CFA mean that once you have that ‘win’, our costs become due. We will try to recover our normal fees from your opponent. However, we cannot recover any success fee or insurance premium (you pay those at the end).

A success fee is an uplift percentage on the Solicitor’s chargeable time that has been incurred up to the date you are successful. The reason for the uplift is that your legal team has invested time and resources in pursuing your litigation and undertaking work with the risk that it may not recover anything if you are unsuccessful.Please note that a success fee can be from 25% up to 100% of your solicitor’s normal chargeable time in progress matters for you.

Should you issue proceedings and be unsuccessful, then costs generally follow the event. This means that your Opponent would also be able to seek an award for costs against you if you are unsuccessful. As a general rule of thumb, costs awarded can be anything up to 70% of the actual fees incurred. These costs can be significant and may be similar to or more than your own legal team’s costs, having gone through the same litigation with you. When taking out a CFA, we would always recommend that you have effective after-the-event insurance (“ATE”) in place to safeguard you against any cost awards in the event you are unsuccessful.

At Wilson Browne Solicitors, we recommend ATE from Temple Legal Protection Limited. We do not get paid any commission by them. Whilst there are other insurers, and we are not brokers, we do believe that this policy works well for most cases. Reference to ‘ATE’ here is limited to what we know about Temple. At the start of your case, Temple will assess the likely prospects of success and the merits of your case when considering any offer it is is willing to make in respect of granting insurance to protect you. It will cover your expenses (disbursements as we call them), the other side’s costs, AND the premium itself. You only pay if you win, and only pay at the end. Bespoke quotes will be provided. Terms apply, including limits on cover.

No

An initial assessment of the merits and likely prospects of cost recovery would need to be considered, the amount or your claim, together with whether we feel that your opponent will be bale to pay any agreed or ordered settlement. This will provide an early indication of whether a CFA arrangement would be suitable and work for you, and for us. It can be a huge commitment to invest in your litigation and take the risk that we may not be paid.

As said at the start of this guide, claims under £10,000.00 typically fall within the Small Claims Track of the County Court, and costs would not be recoverable. Further, should you need any award to rectify any damage, then a CFA arrangement is unlikely to work for you, even if the values would make it a viable option otherwise. It is always worth discussing whether you will be able to pay the success fee and the premium out of any amount awarded to you or whether you will fund these separately.

f your opponent is insolvent or of limited means and is not insurance-backed backed your case would not be suitable for a CFA as it is likely to result in enforcement issues when seeking to recover any amount awarded to you. Each case will need to be assessed on its own merits. When looking to fund litigation in this way, there are additional formalities and due diligence requirements at the outset and prior to any confirmation and agreement to fund any litigation on a CFA. It is not a case of one size fits all.

There are a number of variables that need to be taken into account. Your case has to be a viable and attractive option for everybody involved and would also have to work in practice. There has to be something in this for you first and foremost, otherwise you will rightly question what the point of it all was. Certain cases would ordinarily be more suited to a CFA arrangement.

Remember that expenses (“disbursements”) would not be paid for by us. You will be required to pay any Court fees and any other third-party disbursements and expenses unless a separate disbursement funding arrangement exists or you choose to finance the disbursements by alternative means. We can talk to you about that once you have ATE insurance in place.

No matter what type of claim you are pursuing, chances are we have funding options to suit.

Funding options are numerous and can be quite complex, but here at Wilson Browne, we like to keep things simple.

Investigating a claim is expensive, sometimes costing thousands of pounds. We can help with cash flow concerns and will work with you on a solution that will often see us standing shoulder-to-shoulder with you, carrying some of the risk. There are a number of ways that we can help:

• Legal Expenses Insurance – You should check your insurance policies to see if they include legal expenses cover.
• No Win, No Fee agreements – Technically called “conditional fee agreements” they mean that you do not have to pay the cost of your solicitor if you lose your case. If you win, then you may have to pay something out of the money we recover. This is as a result of changes brought in by the Government on 1st April 2013. We are proud to hold delegated authority from Temple Legal Protection Limited to make sure that cases on a no-win-no-fee are fully insured. Where we can work for you on this basis, we will. Find out more about how we work with Temple Legal Protection here.
• Trade Union help – if you are an individual member of a trade union, they may be in a position to help.
• Public Funding – legal aid is no longer available for commercial or professional negligence cases.