How to Pay for a Personal Injury Solicitor
The U.K. no longer offers legal aid for personal injury cases. Unfortunately, if you’ve suffered a personal injury, you’ll have to pay for legal representation on your own. The good news is that no-win no-fee arrangements mean you don’t have to pay anything at all unless your solicitor wins a settlement for you.
Your solicitor may collect damages-based arrangements (DBA), which means that when you receive your settlement, you’ll pay a percentage of it to the solicitor. You might also pay according to a conditional fee arrangement (CFA), in which you pay the solicitor’s fee plus costs only if the solicitor wins your case. Claims Direct, for example, is one U.K. personal injury solicitor that charges a conditional fee arrangement.
You can take out insurance, either before or after you’re injured, to cover the other party’s legal fees if you lose. Also, if you win your cases, the insurance company will likely pay at least part of your solicitor’s fees, so you won’t be responsible for all of them.
Until April 2013, personal injury solicitors couldn’t ask for damages-based payment arrangements. However, Parliament passed new DBA regulations in 2013, which allowed personal injury solicitors to offer DBAs to their clients. If a personal injury solicitor wins a case for a client, the solicitor can collect up to 25 percent of the damages in legal fees. Before choosing a solicitor who asks for a DBA, keep these points in mind:
- Paying straightforward fees could cost less for you. The defendant will have to pay your solicitor’s fees, including hourly rates and costs, as part of your settlement. However, if that amount doesn’t equal the full 25 percent of your damages, you’ll still have to pay the remainder of the DBA.
- Solicitors who offer DBAs risk making less money. If the damages that your solicitor recovers for you are small, your solicitor could earn much less than he or she would have earned had you been charged a regular fee. Because of the indemnity principle, solicitors can only recover the DBA fee, not their costs and their fees for hours worked, from the defendant.
- DBAs can create a conflict of interest. If your solicitor receives a decent-sized settlement offer early in your case, your solicitor might prefer to collect a DBA at that point without having to put in too many additional hours of legal work. Beware of solicitors who push you to take early settlements, particularly when you have a DBA, when you know you’re entitled to more.
Conditional Fee Arrangements
Conditional fee arrangements spare you from paying your solicitor if you recover no damages from the defendant. They protect you from paying if you lose your case, and they discourage solicitors from bringing unnecessary cases to court.
When you hire a personal injury solicitor and agree to a CFA, the defendant will be asked to pay your legal fees and your solicitor’s costs if you win. In addition to charging for their legal fees and costs, personal injury solicitors may also charge an uplift fee, or a success fee, of up to 25 percent of your winnings. In the past, losing defendants had to pay the uplift fee, but now, claimants have to pay it.
What Happens if You Lose?
To protect yourself from paying court costs if you lose your case, you can take out insurance that will cover the defendant’s legal fees and costs. You can purchase this insurance either before you’re injured or after you’re injured.
- Before the event (BTE). The Ministry of Justice encourages people to purchase BTE insurance as an add-on to their home or auto insurance. The premiums are much lower when you’re insured before an injury.
- After the event (ATE). You can also purchase insurance to cover court costs when you bring your case to court. However, the defendant no longer has to pay your ATE premium if you lose, so you’ll pay for the premiums out-of-pocket.
Have Your Day in Court
If you’re injured in an accident and someone else is at fault, you deserve to receive compensation. No-win no-fee arrangements give you access to representation regardless of your ability to pay.