Why won’t a solicitor take my no win no fee claim?

Photo of Kevin Donoghue, Solicitor, explains why a solicitor won't take a no win no fee claim.

Kevin Donoghue, Solicitor, explains why a solicitor won’t take a no win no fee claim.

By Kevin Donoghue, solicitor

You’ve decided to claim compensation, researched which solicitors’ firm to use, and got in touch with a lawyer.

But the solicitor you contact says they won’t represent you, even using a conditional fee agreement (also known as ‘no win no fee’) agreement.

If you’re in this position and find yourself asking “why won’t a solicitor take my no win no fee claim?” let me give some insight.

Funding Options, including No Win No Fee Funding

Funding for legal cases is something which all solicitors are under a legal duty to consider with their clients at the outset.

As you may know if you’ve read our page about how much it costs to make a police compensation claim, the page on our site about no win no fee accident claims, or the professional negligence no win no fee section of our website, we try to be clear and straightforward in our explanations of the various funding options available. These include:

  • legal aid;
  • paying for your case privately;
  • using before the event or union funding; and lastly
  • no win no fee agreements.

That way you know what to expect when you speak to us, or any other solicitor, about your claim.

Talking about how your case will be funded is important because starting a compensation claim (especially on a no win no fee basis) is a big decision, not least because of costs.

Prospects of Success and Costs

Unfortunately, there is never one simple explanation to answer the question “why won’t a solicitor take my no win no fee claim?”, but some common reasons are:

1.      The solicitor who reviewed your case is not confident it will succeed.

This is the most important reason, as solicitors only take cases on if they are confident that there is a reasonable prospect of winning.

It applies regardless of the method of funding used, even with private clients who pay their own legal fees, legal aid, and union- backed cases.

For a solicitor to:

they must have absolute confidence in the client, their case, witnesses, evidence, and many other things.

Solicitors want happy clients who win. Getting the maximum compensation for clients to help them get their lives back on track is what gets lawyers like me out of bed in the morning.

Losing benefits no one, especially the client, who will have wasted their time and effort in claiming compensation.

So the reasons for declining to act, especially on a no win no fee basis, are not purely selfish.

Of course, solicitors want to be paid for the work they do. (Law firms are not charities; they are businesses. In business, who doesn’t want to earn money?)

And losing a no win no fee case means that the solicitor would not get paid their own costs, which can run into the tens of thousands of pounds and put strain on the firm’s finances.

But there’s more to it than that.

Solicitors are under a duty to act in the best interests of their clients, who are called “claimants” in civil compensation claims.

And changes in the rules which came into force on 1 April 2013 mean that taking a legal case is now a more risky proposition for claimants.

Why?

Because the Legal Aid, Sentencing and Punishment of Offenders Act (2012) abolished the right of innocent claimants to recover “success fees” and after the event insurance from the losing defendant, or more usually, the defendant’s insurance company.

Success fees uplift the claimant’s solicitors’ fees to compensate for:

  • the risk of taking the case and losing; and
  • delaying payment.

After the Event insurance provides protection for the claimant’s own expenses, such as court and experts’ fees (called “disbursements”), barrister’s fees if necessary, and the other side’s costs.

Being able to recover success fees and after the event insurance from the losing defendant (or their insurers) meant that, before April 2013, the winning claimant would usually receive 100% of their compensation.

(This is why people commonly think of “no win no fee” as free legal representation, when in fact the term means that if you win, there is a fee. It’s just that, before 1 April 2013, that success fee was paid by the losing defendant and not the successful claimant.)

The system in place before April 2013 ensured that the winning claimant’s solicitor could get paid a fair rate (legal costs plus a success fee).

And the after the event insurance protection meant that, if the claimant lost their case, they would still be able to walk away “scot-free” as their solicitor would honour the no win no fee agreement and waive his or her fees, and the insurance would pay for the rest of the claimant’s expenses and the defendant’s costs.

But, since 1 April 2013, if the claimant loses they are only protected for their own solicitor’s fees (under the no win no fee agreement) unless “qualified one way costs shifting” applies. Now they have to pay for their own disbursements, barrister’s fees (unless also working under a “no win no fee” agreement), and the defendant’s costs out of their own pockets unless they can get after the event insurance and agree to pay for it out of their damages (if they win).

Since 2013 the market for after the event insurance has shrunk considerably, so that it is very difficult to get in some areas of law, such as actions against the police.

Without it, taking a case to court and losing could cost the innocent claimant thousands of pounds. Defendants and their insurers don’t instruct cheap lawyers and experts, court fees for running a case to trial alone can exceed £2000, and if you need an expert or two to prove your claim (most cases do), then you are responsible for their costs too. (Experts can’t work on a “no win no fee” basis because their duty to give an impartial opinion means they can’t be influenced to find in either side’s favour by the risk of not getting paid.)

Imagine taking a case to court, losing, and being left with a judgment debt for thousands against your name? You would have to find the money to pay the debt and deal with the impact on your credit score. All because you wanted to make a compensation claim.

For this reason alone, being told that your solicitor will not take your claim on a no win no fee basis, as a private client, or any other way, can be a good thing.

2.      Your claim is of low-value

The small-claims limit, below which legal fees are not paid, is £1,000 in personal injury cases, and £10,000 otherwise.

In principle, this means that most personal injury cases would be eligible for costs if successful.

But not all.

Minor injuries, limited psychological upset claims, and cases where the claimant makes a quick recovery, can mean that costs will not be paid even if the claimant is successful.

As a result, the claimant’s own solicitor’s fees and disbursements would have to be paid out of their damages. In practice, this means that the claimant would be left with nothing.

In other cases where personal injury is not claimed, such as many data protection breach claims, even recovering £9,999 would mean that costs do not have to be paid. Again, the winning claimant could end up with nothing once his or her own legal fees, disbursements, etc. have been met.

Going back to the discussion on After the Event insurance, even if the claimant is willing to pay for the insurance out of their own pockets, the fees can be extremely high, and often more than the total compensation the innocent claimant might expect to recover. So, in the event that the claimant succeeds in their claim, they might end up paying all of their damages over to their own insurer before also having to pay out of their own pockets for court fees, experts’ fees etc.

And that’s before paying the 25% success fee (or more with some firms, not Donoghue Solicitors) to their own solicitor.

With that in mind, why bother claiming at all?

This assessment is known as “the costs/ benefit analysis” and is part of the solicitor’s job of ensuring that they act in the best interest of the client.

Winning, but being left with nothing but debt, is clearly not in their best interests.

3.      Pressure of work

Solicitors are the most heavily regulated professionals in England and Wales. More than doctors. More than accountants. More than anyone.

The hoops they have to jump through to satisfy:

  • the Solicitors Regulation Authority;
  • their professional indemnity insurers ;
  • the Legal Ombudsman;
  • the Information Commissioner’s Office;
  • the Courts (solicitors are Officers of the Court, unlike barristers, and have specific duties to perform there); and
  • many others

mean that running cases is just one part of the job.

Failure to keep the governing bodies happy can result in serious consequences, including being struck off the roll of solicitors, having to close the firm, and bankruptcy.

It is no surprise then that many solicitors will limit the amount of clients they take, even if those people have potentially good claims, because they do not want to risk failing in their duties to their existing clients, governing bodies, staff, creditors, and others.

4.      Personality Issues

Making a compensation claim can be an uncertain business. When clients ask me “how long will it take?” the answer is always: it depends.

It depends on:

  • how much co-operation I receive from my client;
  • how quickly I receive the information I need to decide what to claim for, if at all;
  • if we have funding issues to deal with;
  • how quickly the defendant responds to the claim, if at all;
  • if the defendant fights the claim, and why;
  • if there are witnesses to track down and interview;
  • if we have to issue proceedings to force the defendant to produce evidence;
  • if we have to issue full court proceedings to take the case to trial;
  • if there are settlement negotiations;
  • what court delays we experience;
  • if we go to trial, and if a jury is involved; and
  • if we get paid, and when.

With all this in mind, compensation claims can take anywhere from a few months to many years. It is not uncommon for cases to take two to three years to reach trial.

Having a good working relationship between the solicitor and the client during the time a case is running is vital.

People work best with people they like.

It is for this reason that clients should make sure they have a good fit with a solicitor they like and trust before agreeing to start the relationship. After all, the solicitor will be making demands on their client’s time, resources, and potentially finances.

Solicitors think about whether the client is a good fit too. We can’t win cases on our own. We need our clients’ full, helpful co-operation.  And smart clients know that the solicitor needs to be left alone to do his or her job, that’s what the client is paying for after all. Constant emails, phone calls, and other interruptions not only increase the bill but result in a strained relationship, which is bad for both the lawyer and the client.

What to do if a solicitor won’t take your case on a no win no fee basis

Solicitors are generally free to decline to represent whoever they like. They don’t have to give reasons or enter discussions about why, but the reasons are likely to involve some or all of the issues above.

If the solicitor you approached won’t take your case there is nothing to stop you enquiring with another lawyer. There are over 140,000 solicitors practising in England and Wales so there are plenty of options.  The Law Society’s find a solicitor service is a good place to start.

 

Kevin Donoghue is the Solicitor Director of Donoghue Solicitors, a specialist law firm dealing with compensation claims against the police, personal injury accident claims, and professional negligence claims.