Managing the downside risk of dealing with a dispute, particularly if court proceedings are commenced, is also of paramount importance. This is because there is always a risk, no matter how small, of losing the case and the investment you have made in it, and being required to pay a proportion of your opponent’s costs.
We can advise you on a range of potential funding, risk sharing and insurance options, to help address these concerns. The options available will depend on the type of dispute you are involved in, and the forum best suited to resolving it, but can include;
- Standard, private paying arrangements, where you pay our fees and any expenses we incur on your behalf as the case progresses, on the basis of estimates or fixed fees, agreed with you in advance.
- Conditional Fee Agreements (CFAs) where our fees are discounted in full or in part as the case proceeds. If the case is won, you pay us the amount of the reduction applied, plus a success fee. If the case is lost, you do not have to pay the discount applied to our fees, or any success fee. You would still need to pay any expenses we incur on your behalf under a CFA whether or not the case is successful.
- After the event insurance (ATE Insurance), which protects you against the risk of having to pay your opponent’s legal costs if your claim is unsuccessful. Many ATE Insurance policies also include cover to reimburse you for any expenses you have incurred if the case is lost. ATE Insurance can sit alongside a CFA to significantly reduce the overall cost and risk of pursuing a claim. Some insurers will agree to defer all or part of the policy premium until the conclusion of the case, but the premiums can be expensive.
- Third party funding schemes, where a professional funder will finance some of your fees and all of your expenses, including the cost of ATE Insurance, in exchange for a proportion of the recovery made. This type of scheme is only suitable if you are bringing a claim for financial compensation. We have partnered with Augusta Ventures (“Augusta”) to provide a virtually risk free litigation funding solution for our clients. For more information please scroll down.
- Contingency fees, where you would not be charged our fees in full or in part if you lose, but if you are successful, our fees would amount to a percentage of what is recovered (plus any reduced fee we had agreed to charge as the case went along). Again, this type of arrangement is only suitable if you are seeking financial compensation, and unlike third party funding schemes, contingency fee arrangements cannot be used where court proceedings are issued.
Third party funding
We have partnered with Augusta Ventures to provide a virtually risk free litigation financing solution, to help businesses and individuals meet the cost of bringing claims for compensation.
Typically, your claim will need to have a value of at least £250,000, to ensure that you receive a large enough proportion of any damages to make taking the action worthwhile.
The solution can provide funding of up to £600,000 per case, to meet the cost of high value, complex and heavyweight litigation, too.
The starting point is the same as for any dispute – does your case have a good chance of success, and can the opponent afford to pay the amount of your claim and costs? If the answer to both of these questions is yes, litigation funding and costs insurance could be available.
The way the scheme works is relatively simple. If your case qualifies:
- We will work under a Partial Conditional Fee Agreement (PCFA) meaning that usually, around 60% of our fees are paid as the case progresses and 40% are only paid if the case is successful.
- Typically you would have to pay half of the 60% PCFA fees as the case progresses. The other half would be paid by Augusta, as well as all of the other litigation costs, such as court fees, barrister’s fees, and expert’s fees.
- Augusta will arrange insurance, at market leading premiums, to cover your liability to pay the opponent’s costs, should the claim fail. Insurance can also be taken to cover 90% of the costs you have paid under the PCFA.
- This means your overall costs risk would be less than 2% of the cost of pursuing the case, as opposed to the normal risk of having to pay all of your own costs and around 70% of the opponent’s costs, if the claim is unsuccessful.
- If you are successful, you will end up with approximately 70% of the net damages awarded at trial, or any settlement sum negotiated. The remaining 30% is usually sufficient to cover the deferred PCFA costs and all the costs of the litigation funding, although the exact percentages will vary from case to case.
This form of litigation funding means that you can pursue a damages claim at a fraction of the usual cost, and the downside risk of losing would be as little as 2% of the total costs of bringing the case.