Personal injury is an unusual area under English law – it is really the only area where a no win no fee agreement generally works very successful both for no win no fee solicitors and for clients (although there is a growing trend towards a degree of shared risk in some commercial disputes, especially for high value and complexity cases or relating to insolvency disputes), with most personal injury lawyers offering 100% compensation. No win no fee is available in many other areas of law, but doesn’t work nearly as well. An example of this is employment claims. The difficulty with these claims is that there is a general no costs rule in the Employment Tribunal which means that a successful claimant will have to pay any legal fees out of his or her award. With an average Employment Tribunal award at less than £10,000.00 it can easily be the case that the claimant ends up paying all damages over to his or her solicitors.
This no costs rule does not apply to personal injury claims and the other important factor is that, whilst the evidence of witnesses and the claimant and perhaps defendant is important, there is often other evidence available, some quite clear rules regarding for example accidents at work or car accident and road traffic law and medical evidence. consequently, there is often greater visibility on prospects of success with injury claims than, for example, with employment claims.
Another advantage for claimants is that personal injury solicitors will pay out for the expenses of starting and pursuing a claim, such as court fees and medical evidence costs, which would otherwise mean that many would not be able to bring a claim.
One issue to be aware of is that with no win no fee agreements is that the lawyer will have a say in settlement. If the defendant, or more accurately often their insurer, makes an offer which, whilst not at the top end of what might be achieved on a best case scenario at trial, is considered reasonable on a risk/benefit analysis by the lawyer, it may be that the client must accept the lawyer’s decision. This should always be discussed and clarified between solicitor and client at the stage the no win no fee agreement is entered into.