What is a CFA?

The potential cost of legal proceedings can be one of the biggest concerns for someone considering a claim.

This can be particularly relevant in contentious probate and inheritance disputes. You may believe that you are entitled to a share of an estate, that a Will should be challenged or that money or property was wrongly transferred before someone died, but the assets themselves may remain tied up in the estate.

One possible way of funding aclaim is through a Conditional Fee Agreement (CFA).

You may have heard a CFA described as a “no win, no fee” agreement. Although that is a useful shorthand, it does not tell the whole story.

At DJF Solicitors, we believe clients should understand from the outset how their case will be funded, what they may have to pay and what financial risks remain.

What does CFA mean?

It is an agreement between a solicitor and their client under which the solicitor's entitlement to some or all of their fees is dependent upon the outcome of the case.

In simple terms, the solicitor agrees to take some of the financial risk of pursuing the claim.

The precise terms of a CFA can vary, so it is important to understand the particular agreement being offered to you.

Is a CFA the same as “no win,no fee”?

CFAs are frequently called “no win, no fee” agreements, but clients should be careful about assuming this means there can never be anything to pay if a case is unsuccessful.

A CFA primarily deals with thefees charged by your solicitor.

There are other costs associated with litigation which may fall outside that arrangement.

The terms of the CFA should therefore be considered carefully before proceedings are started.

What is a success fee?

Where a CFA provides for a success fee, this is an additional fee which becomes payable to the solicitor if the case succeeds in accordance with the definition of success contained within the agreement.

The success fee reflects the risk the solicitor has taken by making some or all of their fees dependent upon the outcome of the case.

Before entering into a CFA, you should be told how the success fee operates and how it may affect the amount you ultimately receive from your claim.

The precise arrangement willdepend upon the CFA offered in your individual case.

What are disbursements?

Disbursements are expenses incurred in connection with your case which are payable to third parties.

They are different from the professional fees charged by your solicitor.

Depending upon the nature of the dispute, disbursements can include:

Court fees
Barristers' fees
Expert witness fees
Medical record charges
Land Registry fees
Probate documents and searches
Specialist reports
Other third-party expenses required to pursue the case

Clients should expect toremain liable for disbursements unless DJF Solicitors expressly agreesotherwise in writing.

This means that even if yoursolicitor's fees are being dealt with under a CFA, you may still be required tofund expenses needed to progress the case.

Where possible, we will explain anticipated disbursements before they are incurred so that you understand the likely expenditure.

What happens if I win my case?

If your case succeeds, fees will become payable in accordance with the terms of the CFA.

Depending upon the circumstances, you may also be able to recover a proportion of your legal costs from the opposing party.

However, clients should notassume that all legal costs will automatically be recovered from the otherside.

There can be a difference between the amount you are required to pay your solicitor and the amount recoverable from another party.

Any applicable success fee will also be dealt with in accordance with the CFA.

We will explain the proposed arrangement before you enter into it so that you can make an informed decision.

Could I have to pay the otherside's costs?

Potentially.

A CFA with your own solicitor does not automatically protect you against every financial risk associated with court proceedings.

Civil litigation can involve the risk of being ordered to pay some or all of another party's legal costs.

The costs position can depend upon what happens during the case, any settlement offers made, the conduct of the parties and the eventual court order.

These risks should be considered before proceedings are issued and kept under review as the case progresses.

What is After the Event insurance?

In some cases, After the Event (ATE) insurance may be available.

ATE insurance is a separate product from a CFA. Depending upon the policy, it may provide protection against certain litigation risks, potentially including specified disbursements or adverse costs.

It is not automatically availableor appropriate for every claim.

Policies have their own terms, exclusions and premiums, and we will discuss ATE insurance with you where it is relevant to your particular case.

Does DJF Solicitors offer CFAs for contentious probate claims?

Yes, we may offer Conditional Fee Agreements in appropriate cases.

However, we cannot offer a CFA for every dispute. Before agreeing to act under a CFA, we need to assess the case carefully.

We may consider:

The legal merits of the proposed claim
The strength of the available evidence
The value of the claim
The likely legal costs
Whether those costs are proportionate to the amount in dispute
The likely response from the opposing party
The prospects of recovering money or property if the claim succeeds
The overall litigation and costs risks

A claim may have reasonable legal prospects but still be unsuitable for CFA funding if the likely costs are disproportionate to its value.

We may therefore need documents and further information before deciding whether a CFA can be offered.

What types of contentiousprobate claims could potentially be funded by a CFA?

Subject to an individualassessment, we may consider CFA funding for certain:

Will challenges
Inheritance Act 1975 claims
Proprietary estoppel claims
Lifetime gift disputes
Beneficiary disputes
Estate and probate disputes
Other contentious probate claims

The availability and terms of a CFA will always depend upon the individual case.

Why do we assess the casefirst?

When a solicitor acts under a CFA, the firm accepts some of the financial risk associated with pursuing the claim.

We therefore need to understand the evidence, legal merits and likely financial outcome.

This assessment is also important for you.

Litigation should not be pursued simply because a CFA may be available. A claim should have a sensible legal and commercial basis.

Our objective is to give you a realistic assessment of your position so that you can make an informed decision about whether to proceed.

Free 15-minute Initial Consultation

If you believe you may have a contentious probate or inheritance claim but are concerned about how you will fund it, speak to our team.

DJF Solicitors offers a free 15-minute initial consultation to assess your case and discuss the potential next steps.

If the case appears suitable, we can discuss the available funding options and whether we are able to offer a Conditional Fee Agreement.

Please remember that a CFA does not necessarily mean that you will have nothing to pay. In particular, clients may remain responsible for disbursements and there can be other costs risks associated with litigation. We will explain the proposed funding arrangement before you decide whether to proceed.
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Speak to DJF Solicitors - DJF Solicitors is a national law firm with offices across England, advising clients in Bristol, London and throughout the country. If you have an inheritance or contentious probate dispute and would like us to assess your case, take advantage of our free 15-minute initial consultation.

Make an enquiry here and a member of our contentious probate team will contact you. Call us today on 0203 504 9138, or email us at info@djfsolicitors.co.uk to schedule your free initial telephone consultation.

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Article by Nicole Nedungadi, Private Client Solicitor at DJF Solicitors