The Advantages and Disadvantages of Conditional Fee Arrangements for Legal Aid

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  • Topic: Contingent fee, Lawyer, Personal injury
  • Pages : 7 (2700 words )
  • Download(s) : 484
  • Published : May 5, 2011
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The conditional fee arrangement was introduced by the Access to Justice Act (AJA) 1999, as an attempt to transfer legal funding from the treasury to the private sector. This occurred as a result of an increasing and ridiculous growth in the cost of legal aid, namely from a few hundred million to well over 2.1 billion pounds from the 1980s to 2000. Moreover, it was not because demand was growing. Rather, number of cases relying on legal aid had decreased. Due to the need to control budget, Conditional fee arrangements are used to fund many civil cases which legal aid now excludes, and the issues brought about by conditional fee arrangements have been debated over the last decade. The conditional fee arrangements are sometime known as ‘no win, no fee’ agreements, which are not used for family or criminal matters, but can be used in many types of civil action. The no win no fee concept was first introduced in the UK under the Solicitors Conditional Fee Agreements act in 1995. The primary reason for the no win no fee system was to make sure that individuals who did not qualify for legal aid could still make personal injury claims, regardless of their personal situation. Section 58 of the Courts and legal Services Act (CLSA) 1990 permitted the Lord Chancellor to introduce conditional fee arrangements. By 2000 legal aid was actually abolished for personal injury claims, resulting in the no win no fee personal injury claim system being the normal system that most claims work under. The beauty of the policy is that if you do not win your case, you are not required to pay any sort of fees to your no win no fee solicitor. Instead, the insurance will cover any costs and expenses of all parties involved, including your no win no fee lawyer. This allows you the safety and security of knowing that even if you are someone who is financially struggling, you still have the right to make a claim, and you will not have to pay if you for some reason lose your case. If you happen to win your case, you will automatically be compensated for 100 per cent of the fees attached to the personal injury claim. The purpose of the system is to make sure that everyone involved is covered by the insurance companies. The only fees which are potentially applicable to a person filing a claim are exceptional circumstances or medical negligence cases, which will need to be discussed in advance with your lawyer. Admittedly, based on my research, the only groups of individuals who have really benefitted from this scheme are the lawyers, the claims management companies (CMCs), the banks and the insurance companies, which, is typically the supplier base for this system. In contrast, the consumers themselves have little but complaints, even though the Conditional Fee Arrangement were targeted to helping them in the first place. The introduction of Lord Justice Jackson’s report this year 2010 is new and the effects have not been visible in the current market, though we may look at the theoretical and legal implications that such an upheaval in the Conditional Fee Arrangement this would bring. A major benefit of Conditional Fee Agreements is that it allows many people access to justice, and in addition does not have to receive any funding from the Government leaving them free to fund more serious civil cases. Because of agreements like these many people have been able to take their cases to court, all that is required is that the client buys insurance against losing a case. If this requirement is met then it is unlikely that the case will not be taken on by a Solicitor. The Solicitor is also likely to work harder on the clients behalf because it has invested interest. This will then result in more competition between Solicitors and as a consequence of this, the client receiving a better service. A Conditional Fee Arrangement provides access to the courts for those who cannot afford to pay the attorneys fees and costs of civil litigation. Contingency fees also provide a...
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