What are No win No fee agreements

No win no fee injury compensation claims were devised out of concerns that legal aid was costing the Treasury excessive amounts every year. Therefore a new scheme was devised. Known formally as conditional fee agreements (CFA), they are now more widely known as no win no fee agreements, which were first allowed in some cases in England and Wales back in 1995, though it wasn’t until 1998 when they could be applied to all types of civil cases, apart from cases going before the family courts.

The Access to Justice Act 1999 abolished legal aid for personal injury cases so CFAs become the only hope for many wanting to take court action, while the act also increased the attractiveness of the arrangement as judges could force the losing side to pay the extra costs associated with CFAs. These are the “uplift” fees charged by solicitors to compensate for the possibility of loss.

Essentially a CFA is a written agreement whereby legal fees and expenses will only become payable in certain circumstances. In a no win, no fee agreement therefore, the meaning is in the title as the legal fees will not be payable if the claim is lost. However, what are known as disbursements, are usually payable in any situation regardless of the outcome of the case. These are out of pocket expenses and include such items as barrister’s fees and court fees. So, it is important to note that though cases can be advertised as “no win, no fee” it is not generally quite as straightforward as the title suggests.

However, in general terms if a case is won the lawyer’s costs will be paid together with the success fee, which is a percentage uplift on those fees and the general principle is that the loser pays the winners costs. So the loser would therefore be liable to pay the success fee as well as all the other legal costs. However, in all cases which reach court, the awarding of costs is entirely at the judge’s discretion. So, some who win their case may still be ordered to pay their own legal costs, particularly if they are at fault in some way. Alternatively, someone who loses may not have to pay all the costs of the case, it is entirely down to the judge and whilst the loser pays the winners costs is the general rule it is not always followed.