During a recent Court of Appeal ruling, one ‘no win no fee‘ agreement between the victim of an uninsured driver and solicitors was recently referred to as grotesque in nature.
Lord Justice Jackson made the claim against the victim’s injury solicitors. He stated that despite the fact that no risk existed, the solicitors would still be in receipt of a ‘success fee’ of £100,000.
Cyclist James Pankhurst suffered severe injuries in 2003 when he was struck by a car driven by Mr Lee White on a Devon country lane. Mr Pankhurst was awarded in excess of £6 million in personal injury compensation from both Mr White and the MIB. The Motor Insurers Bureau had become party to the lawsuit due to Mr White driving without insurance.
Liability had been admitted at trial before Mr Pankhurst entered into a conditional fee agreement with his personal injury solicitors. The success fee the legal firm was entitled to included stipulations that would entitle it to 22.5 per cent from a pre-trial settlement. The after trial amount was listed at 100 per cent. The deal also included a postponement fee of 10 per cent payable to the client in the case it proved unrecoverable from the MIB.
On appeal Lord Justice Jackson criticised the fee agreement. He stated that there was no risk at all of the solicitors not receiving their full base costs according to the circumstances of the case. The judge took issue with the solicitors’ behaviour, stating that by charging a success fee in addition to their base costs for a risk that could not come to be was unacceptable.
The court decided to dismiss the appeal. Lord Justice Jackson entered his regrets into the record. He stated that he regarded the arrangements that had been made by the solicitors of the claimant to be completely grotesque.