(i) Explain what is meant by a conditional fee agreement and when it is used

(ii) Describe the other ways of funding legal help and representation when bringing a civil claim.

(b) Explain the criticisms that have been made of conditional fees and the other methods of funding.

Written by Hannah Hughes (Dec 2005)

Introduction

In this essay I plan to answer each question separately in order to give my essay a clear layout.
I shall start by explaining what a conditional fee is and how this is put into practice to aid the public with bringing their claims to court.

I shall then continue the essay by describing other ways of funding legal help and receiving representation in a civil case.

To conclude my essay I shall then proceed to explain the criticisms that have been made of conditional fees and the other methods of funding available.

(a) (I) Explain what is meant by a conditional fee agreement and when it is used;

A conditional fee is an agreement between a client and a solicitor that is drawn up when the client wishes to make a claim. They were first allowed by section 58 of the Courts and Legal Services Act 1990 in personal injury, insolvency and human rights cases. However by 1998 the use of conditional fees was extended to all civil cases except family cases.

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 expertπs 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 to 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.

Insurance

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.

Claim Firms

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 ≥sky high≤ rates of insurance cover. On the other hand they do allow people to approach these firms without the intimidation of getting involved with solicitors.

Conclusion

Conditional fees do provide the public with a great service. People who may not have been able to afford or felt threatened about taking a civil case to court are now finding the prospect slightly less daunting. In addition to this insurance cover is now available so that should a client be unsuccessful in his claim, the fees of the losing side will be paid for by the insurance cover.

This is a major step forward for the legal system in allowing the public ≥access to justice.≤

(ii) Describe the other ways of funding legal help and representation when

bringing a civil claim.

Introduction

Paying privately for a Solicitorπs advice and representation in court is not the only other option available to the public. There are a number of other providers who will provide free legal advice and representation, the most common being civil legal aid. This is something I will discuss later in this essay.

In this part of my essay I will be describing and analysing the different ways of funding a civil claim and providing help and representation to members of the public who are facing legal problems.

Legal Aid

This was first established in 1949. In recent years legal aid has become in great demand, even reaching figures of £2,041 million for both criminal and civil cases. Because of this the Lord Chancellor had to try and control of the amount being spent in this area.

Legal Aid is available for most civil proceedings that take place in the House of Lords, Court of Appeal, High Court, County Court and the Magistrates Court. However defamation, conveyancing and the drawing up of a will are not supported by the Community Legal Service Fund.

Before any public money is distributed, every individual has to have their case assessed to see if it merits the use of public money and the likelihood of the case being successful. It is also possible that the request will be rejected if the client is only going to gain a small amount from the case. Inevitably this means that even though someone may be legible for legal aid, it does not necessarily mean they will be granted it.

Pro bono work

This type of work is carried out by Barristers and Solicitors. This involves lawyers offering there usually services to clients, however this is done so, free of charge. This was set up in order to help tackle the ≥access to justice≤ argument. It is thought to be a very important aspect of Solicitors and Barristers work, so much so that lawyers are expected to carry this ≥law for free≤ work in order to show off their good character.

Law Centres

These centres were established to provide the public with free legal advice, another way of allowing the public access to justice. Welfare law, immigration, planning and environment, discrimination and the rights of children is some of the areas of law that are covered by the 50 law centres that are situated throughout the UK. Again this service is provided by Solicitors carrying out free work, however lay people can also offer their services to the law centres.

This scheme has always been thought highly of. However the funding that is distributed to the centres is decreasing, this may lead to the closure of centres around the UK.

Citizens Advice Bureaux

These were first established in 1938 and since then have grown rapidly. They play a similar role to the Law Centres. However they also deal with different civil issues such as social welfare and debt.

A main disadvantage is that just like the law centres the Bureaux can only offer advice and do not provide clients with any form of representation in court.

This is primarily because the Bureaux are staffed by volunteers and only occasionally will a solicitor visit a centre to provide free advice.

Charities

Because it is considered near impossible for the legal profession to be the only body that provides advice and representation for the public, other charity based organisations have also taken on the role. These organisations exist to support people who are dealing with a civil claim on a certain point of law. These include Trade Unions who will look after employees of a business on issues relating to employment law. In addition there are organisations that help members of the public on housing issues, Shelter being a main organisation in this field.
Companies also provide legal help, the main ones being the AA and RAC who offer legal advice for clients who have been involved in traffic situations.

(b) Describe the criticisms that have been made of conditional fees and other

methods of funding

Introduction

As with many, if not all, aspects of law everyone has an opinion. Itπs these opinions that help make up the advantages and disadvantages, in this case, of legal funding.

In the final part of this essay I shall outline the various advantages and disadvantages of the methods of legal funding that I outlined In the second part of this essay.

Conditional Fee Agreements

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 (although still possible) that the case will not be taken on by a Solicitor.

The Solicitor is also likely to work harder on the clientπs behalf because her has ≥invested interest.≤ This will then result in more competition between Solicitors and as a consequence of this, the client receiving a better service.

Because CFAs work on a ≥no win, no fee≤ basis many Solicitors will not want to take on cases that are not likely to be successful and as a result denying the individual access to justice. Because of this certain legal problems such as clinical negligence have to be state funded because they are more likely to be unsuccessful.

Another major disadvantage is that many solicitors who carry out Conditional Fee Agreements will not take on a case unless the individual has taken out insurance against losing. However many cannot afford the insurance premiums, this again throws up the problem of many people being denied access to justice because of these kind of circumstances.

Legal Aid

A major disadvantage of the Community Legal Service Fund is that they have a budget in which they have to stick to. Of course they cannot be blamed for this, however criticisms have been made about the way they use the funding to fund civil cases. It is thought that they tend to fund cases that are not necessarily deserving of public money. Once the fund has run out someone who is deserving of the funding may then have to look elsewhere for help and may find themselves again being denied access to justice.

Having said that it has now become harder to gain access to public money in order to fund a civil claim. Two tests have now been introduced, the merits test and the means test. These tests are used to see if a civil claim deserves to be funded and how likely it is to be successful, this makes it a lot harder for people to get legal aid for civil cases.

Law Centres

These centres are funded by their nearest local Council, however this throws up one major problem. Many Law Centres take on cases for people who wish to make a claim against their local council for housing issues etc, therefore many Councilπs do not provide the centres with enough funding. This resulted in the centres not being able to operate properly and in the worse situations even having to close for a period of time.

Citizens Advice Bureaux

Just like Law Centres, Bureauxπs also face a major problem with funding. Again this leads to the Bureauxπs not being able to operate sufficiently, even having to make the decision to only open for a few hours a day. Because of this many people do not have the opportunity to make use of the services that the advice centres offer.

Conclusion

There appears to be many services available to the public in order to allow them access to justice. However having analysed the criticisms that I have described, there appears to be a lot of room for improvement, funding being a major issue that needs to be addressed.

Because of the problems that the other legal funding agencies face, Conditional Fee Agreements appear to be the best option open to individuals. However even with CFAs, there is a major problem for less well off people because they are not able to afford to make the agreement, especially if their claim is likely to be sent to the High Court.

Bibliography

The English Legal System – 3^rd Edition by Jacqueline Martin

AS Law – Elliot and Quinn

Short-listed essays – James Faulkner (AS Law)