What percentage do no win no fee solicitors take?

In a personal injury claim in England and Wales, the most a no win no fee solicitor can take from your compensation as a success fee is 25%. The cap is set by law, not by the firm, and it only applies to certain parts of your compensation. This guide explains what the cap covers, what it does not, and the other deductions you should ask about before you sign.

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Where the 25% cap comes from

Most no win no fee personal injury claims are run under a conditional fee agreement (CFA). If the claim succeeds, the solicitor can charge a "success fee" on top of their basic charges.

Since April 2013 the success fee can no longer be recovered from the losing side. Section 58A(6) of the Courts and Legal Services Act 1990 says a costs order may not require one party to pay a success fee owed by another party. So, if a success fee is charged, it comes out of your damages.

To protect claimants, the law limits how much that can be. For personal injury claims at first instance, article 5 of the Conditional Fee Agreements Order 2013 sets the maximum at 25% of:

• general damages for pain, suffering and loss of amenity, and
• damages for financial losses other than future losses,

calculated net of any benefits repayable to the DWP's Compensation Recovery Unit.

The cap is a maximum, not a fixed charge. A solicitor can agree a lower success fee, and you should ask what percentage your agreement uses.

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What the 25% cannot touch

The cap does not apply to compensation for future losses. Money awarded for future loss of earnings, future care, or future treatment is outside the descriptions of damages in article 5. The success fee cannot be calculated on it.

This matters most in serious cases, where future losses can be a large part of the award.

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A worked example

These numbers are illustrative only. They show how the calculation works, not what a claim is worth.

Part of the award	Amount
General damages (pain, suffering, loss of amenity)	£10,000
Past loss of earnings	£2,000
Future physiotherapy	£1,500
Total compensation	£13,500

The cap is 25% of the general damages plus the past losses: 25% of £12,000 = £3,000. The £1,500 for future treatment is not part of that calculation.

If no benefits are repayable to the Compensation Recovery Unit, the most that can be taken as a success fee is £3,000. Your agreement may set a lower figure.

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Appeals are different

The 25% limit applies to proceedings at first instance. For other proceedings, such as an appeal, article 5 allows a success fee of up to 100%. Few slip and trip claims go to appeal, but it is worth knowing the agreement may say something about it.

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Damages-based agreements

Some firms use a damages-based agreement (DBA) instead of a CFA. Under a DBA the solicitor's payment is a share of the damages. In personal injury claims, regulation 4 of the Damages-Based Agreements Regulations 2013 caps that payment at 25% including VAT of the same descriptions of damages: general damages and past financial losses, net of CRU sums.

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Other deductions to ask about

The success fee is not always the only thing deducted. Before you sign, ask in writing:

• Is there an insurance premium? Many claimants take out "after the event" (ATE) insurance to cover costs risks. Since 2013 the premium generally cannot be recovered from the other side. Section 58C of the Courts and Legal Services Act 1990 restricts costs orders covering it. If you take out a policy, ask who pays the premium and when.
• Are any disbursements payable by me? Disbursements are costs such as medical report fees and court fees. Ask what happens to them if the claim succeeds and if it fails.
• Are any of the solicitor's basic charges payable by me if they are not recovered from the other side?

A solicitor regulated by the Solicitors Regulation Authority must give you clear information about how your matter will be priced. You can check a firm on the SRA register.

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What happens to costs if you lose

In personal injury claims, qualified one-way costs shifting (QOCS) usually protects claimants who lose. Under CPR 44.14, costs orders against a claimant can only be enforced up to the amount of damages, costs and interest ordered or agreed in the claimant's favour.

There are exceptions. The protection can be lost if the claim is struck out (CPR 44.15) or found to be fundamentally dishonest (CPR 44.16). The protection is "qualified", not absolute.

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Summary

• The success fee in a no win no fee personal injury claim is capped at 25% of general damages and past financial losses, net of CRU sums.
• Compensation for future losses cannot be used to calculate the success fee.
• The cap is a maximum. Ask what your agreement actually charges.
• Ask separately about insurance premiums, disbursements and any unrecovered basic charges.

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Sources

• Conditional Fee Agreements Order 2013, article 5
• Damages-Based Agreements Regulations 2013, regulation 4
• Courts and Legal Services Act 1990, sections 58A and 58C
• Civil Procedure Rules, Part 44, Section II (QOCS)