Conditional Fee Arrangements and Legal Aid

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Rebecca Turner        Assignment 9.18        08/04/2009

a) Identify and explain the purpose of conditional fee arrangements.

Conditional fee arrangements are sometimes known as ‘no win no fee’.  This system can allow legal representation to be provided to you irrespective of your means, with the solicitor recovering their fees only if you are successful. Although this may remove some of the financial risks of taking legal action, it does not remove them all. If you win your case, you must pay your solicitor's fees and any expenses for items such as experts' reports and barrister's or other solicitor's opinions.  These are known as disbursements.  There may also be a success fee, which is a percentage increase a solicitor will charge his client in addition to his normal standard costs in the event of winning a case. The amount of percentage increase usually depends on the likelihood of winning and is based on the solicitor's normal charging rate, usually based on solicitors' hourly rate.

If you lose, you need pay no fees to your solicitor. However, you may have to pay your own expenses such as court and expert witness fees and your opponent's legal fees, including their solicitors’ basic charges and success fee, insurance premiums and disbursements; meaning the statement ‘no win, no fee’ is very misleading and sometimes costs more than what is gained.  

Despite this, the conditional fee arrangements cost the state nothing, as the costs are entirely borne by the solicitor or the losing party, depending on the outcome.

There is also a wider access to justice as the CFAs allow many people to bring or defend cases who would not have been able to afford bringing cases at their own expense; now anyone will be able to bring or defend a case for damages.

Furthermore, conditional fees encourage solicitors to perform better, since they have a financial interest in winning cases funded this way.

On the other hand, some people are concerned that conditional fee arrangements may not be adequate as a substitute to legal aid.  Among several others the Law Society have expressed concerns that certain types of case will lose out under the new rules.  They suggest that solicitors will only want to take on cases where there is a very high chance of winning.  It was for this reason that medical negligence cases have been kept within the state-funded system.

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There is also the risk that where legal aid is refused, a subsequent trial may prove to be unfair if one party is unrepresented by a lawyer as a result, and the other party benefited from legal representation.  This can amount to a breach of Art. 6 of the European Convention on Human Rights, which guarantees the right to a fair trial.  This problem was highlighted by the case Steel v United Kingdom 2005.  The defendants were two environmental campaigners who distributed leaflets outside McDonald’s restaurants.  These leaflets criticised the nutritional content of the food sold in the restaurants.  McDonald’s ...

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