No Win No Fee Cost Agreements.
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The Starting Point.
I started 'No Win-No Fee' legal costs agreements over 25 years ago when I started representing claimants contesting a will, who simply could not afford to pay legal fees. Before that, 'no win no fee' agreements were mainly used in litigation involving personal-injury claims.
'No win no fee' agreements are only available for claimants because claimants sometimes cannot afford to pay up front fees. Defendants costs are almost always paid out of the estate, win or lose, so there is not need for such an agreement flor defendants. In effect the defendant costs are either going to be paid out of the estate; or from a claimant who is not successful in his or her claim.
We still do today, assess the claimant's case and back our advice that our evaluation of of the case is correct. In other words if we believe the claimant has a genuine and proper case we take the risk of winning or losing, to the extent that if we don't win our claimant pays us nothing. Nothing. However that is not necessarily the case with all solicitors costs agreements. And we give all our claimants a written guarantee, if requested that if they do lose and they are court ordered to pay the estates costs we will pay those costs. That's how confident we are in our own skills and assessments.
Increasingly other lawyers use 'no win no fee' as a unique selling point in the competitive world of attracting clients. However as said above claimants should make sure they fully understand how a contingent-costs agreement ('no win no fee' agreement) works before signing up. They are not all the same.
Are 'No Win No Fee" Agreements Risk Free?
Some solicitors advertise that their 'no win no fee' agreement is 'rlsk-free'. Alarm bells should ring in your ear immediately. There is no such thing in my opinion as risk free litigation. The main risk is choosing the right solicitor. There are hundreds of solicitors engaged in 'contested wills' cases these days and many claim to be experts or specialists when in fact they have limited experience. Your risk will be substantially reduced if you chose a Law Society Accredited Specialist (Wills & Estates Law, not family law or any other law) because then there is no doubt that he or she is experienced and suitably qualified. We know one big risk is you may lose your case and be court-ordered to pay the estates legal fess. That happens frequently. That is at least one big risk and that is the risk you solicitor may not have assessed you case correctly.
We constantly see solicitors advertising in this area of law citing that they Accredited Specialists. However when you have a closure look you will see that they are not accredited in Wills & Estates law but some other law completely different to contested wills. Call me and I'll direct you the web sites I refer to. Also we see constantly solicitors letter heads showing the solicitors being Law Society Accredited BUT not disclosing clearly in what area of law.
As with any agreement, a potential claimant should consider its contents closely, feel free to seek clarification and shop around before signing on the dotted line. Free call me anytime for a second opinion.
Whether it is No Win-No Fee, No Win-No Charge or No Win-No Pay, in legal terms these agreements are known as contingent-costs agreements. That is, payment is contingent on a successful outcome. They were most common in litigation involving personal-injury claims and will disputes. They are not permitted in criminal or family law cases.
Be careful what you sign. Double check before signing. The detail in the agreement is what you need to be aware of. Some agreements will exclude certain items and you will be liable for those items if you don't 'win'. Also you may find that after the payment of your legal fees there is not much left for your. Some agreements allow for the solicitor to end up with more that you yet it's your claim. The settlement may end up being for much less that you had anticipated.
The "fee" usually relates to a lawyer's professional charges and may not include disbursements associated with litigation such as court fees, expert's fees, service fees, office costs and barrister or other agents. However most importantly what happens if you lose the case. The worst case senario is that you may not be liable to pay you own solicitor his or her 'professional fees' but you may be liable for hundreds or possible thousands of dollars in your solicitors expenses. Worse still, if you lose you may be held responsible for the estate's legal costs. So, there are risks.
At the end of your case you may not receive any money for months or even years in some cases. Some costs agreements provide that you must pay interest on unpaid fees at high rates of interest all to be deducted from your settlement when the money finally arrives.
The 'Uplift Fee'.
Another 'danger' to aware of is the 'Uplift Fee". If that clause is in you agreement it may be as high as 25%. In other words you when you receive your invoice from your solicitor he or she may be entitled to add another 25%. The uplift fee is a reward for the lawyer assuming the risk that the claim may fail with no fees being paid however in some cases there is absolutely no risk and the uplift fee might still be charged you.
Eric Butler. Free Call 1800 960 156