Welcome to No Win No Fee Solicitors

Many clients learn the hard way that "No Win-No Fee" does not mean "Win-No Pay". This murky understanding of the legalities in these cases has left many clients in debt after winning their lawsuits. Changes last year have simplified the regime of "NoWin - No Fee" or conditional fee agreements (CFA's) and the responsibility of making the legalities clear to clients has been laid at the doorstep of solicitors.

The government hopes that this will improve the situation that has garnered 130,000 complaints about CFA's in the files of the Citizens Advice Bureaux since 2000. For some, since the stopping of legal aid, CFA's are the only way in which they can get justice through the legal system. Take the case of David Whitaker.

Fourteen years ago, David Whitaker was an advisor to entrepreneurs. He assisted them in getting patents for inventions and then finding licensees for those patents. He met up with Pam and Phillip Richardson who had developed a glove for surgeons that was able to recognise when the wearer was at risk of infection. Whitaker and the Richardsons signed an agreement in which if Whitaker should be successful in selling the patent for the gloves, he would receive 30% from all of the profit.

Whitaker was indeed successful and the Richardsons received £17.5 million in total for their invention, but then they refused to pay Whitaker his 30%.

By this time Whitaker was in a bad place. He was diagnosed with cancer and struggling to get through chemotherapy. Without the provision of CFA's he would not have been able to pursue legal action against the Richardsons. Despite a difficult ruling from the judge in the case, Mr. Justice Pumfry, that Whitaker must secure money to show that if he should loose he could cover the Richardsons' legal costs, Whitaker persevered. In the end, the week before the trial the Richardsons withdrew and Whitaker won.

This is the good side of CFA's. The bad side is not so pretty. A BBC 4 investigation into CMS Investigation in 2004 revealed how CFA's can go drastically wrong for clients. In the case, a firm called CMS Investigation that collects lawsuits to turn over to solicitors for "No Win - No Fee" lawsuits collected clients in Bridgend Council area. The clients had issues with their housing authority. CMS handed the cases over to the solicitors PD Associates. Of the eleven test cases that went through the courts, all received settlements, but in all but one the clients, despite having been awarded money, found themselves in debt.

One example was John and Lesley Pace. They were told that they would pay nothing and their draughty 50-year-old house would be repaired. At least that was what CMS Investigation told them. In the end, they had to take out a loan to cover insurance for legal costs if they should not win. Since they won, the insurance did not pay out. They had to take a loan for the insurance so after the case they owed the bank £1481.86 , this after having applied their £1000 compensation from the lawsuit to the debt. The solicitors claimed £8697 for legal costs that the judge did not cover in full and the council would not pay, claiming that they were exorbitant. The debt remains and it is not sure who, in the end, will pick up the tab.

In the Times Online article, Lord Chief Justice, Lord Phillips of Worth Matravers told the Constitutional Affairs Select Committee that the costs associated with CFA's far exceeded the £37million the government saved by scrapping legal aid.