Legal Aid

Topics: Insurance, Risk management, Risk Pages: 5 (1805 words) Published: May 5, 2011
Conditional fee arrangements can be defined as fee arrangement, whereby payment to the solicitor is dependent upon the result of the proceedings, and is permitted by Section 58 of the Courts and Legal Services Act 1990 and the Conditional Fee Agreements Order 1998. Conditional fee agreements are becoming increasingly popular, this is because if the claimant is unsuccessful he/she will not have to pay the Solicitor for his service, hence, no win, no fee. Therefore it is in the best interest of both parties for the Solicitor to win the case, and the claimant to be awarded the damages. When dealing with a civil case it is very difficult to know how much taking the case to court will cost. This is mainly because it is difficult to predict how serious the other party is and how far they are willing to go to defend the case. It is possible that once a court case has started the other party may admit liability, therefore the case does not need to proceed, and so can be settled quickly and comparatively cheaply. However if the case does proceed then the costs of running that case can rise considerably. Other than the cost of a lawyer, there is also the expense of obtaining evidence to support your case and the cost of an expert¹s report on it if necessary, and in addition court fees must also be paid. It is very easy for some civil cases; especially those dealt with in the High Court to cost hundreds of thousands of pounds to run. If the claimant is victorious then they are able to claim most of, if not all, of the costs back from the losing party. In addition to this the Access to Justice Act 1990 now gives the courts the power to make the losing party pay the success fee to the winning parties solicitor on the winning parties behalf. This is because it is believed that if the winning party had to pay their solicitor a success fee then they would have not received the full compensation. However if the claimant is unsuccessful in their case then not only will they have to pay their own costs of taking the case to court, but they would also have to pay the other parties costs. Because of the uncertainty that surrounds a civil case most people would find it too risky, even if they have been advised to go to court because they have a strong case. It is because of this that conditional fees were introduced. It is possibly to get insurance to protect yourself financially should you lose a case. This means that if a client were to lose then the insurance company would pay the winners fees, leaving no burdens on the client. It is important that clients are aware that even though they will not have to pay their solicitor if they lose a case, they can still find themselves with financial burdens. This is because as mentioned the losing party has to pay the costs that the winning party has incurred from bringing the case to court. Because of this it may be a good idea for a client to purchase insurance. This must be purchased in advance and the premiums are based on the likelihood of the client being successful. As mentioned above the main advantage of taking out insurance is that if the client was to lose then the costs will be paid by the insurance company. However many people who are less well off financially may find the insurance to expensive to purchase. These firms are very similar to conditional fee agreements and operate in the same way. Their main function is to negotiate a deal of compensation on behalf of their client against the opposing party. However one of the main problems with claim firms is that they have a reputation for having exorbitant rates of insurance cover. On the other hand they do allow people to approach these firms without the intimidation of getting involved with solicitors. Typically, in the construction industry, the relative strengths and weaknesses of a case may only become clear after an action has started and once an opponent's position has been made clear. Therefore, it is only at this time that a...
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