What is litigation funding?
Conditional fee agreements allow individuals or businesses to make
a legally binding arrangement with a solicitor that some or all of
the fees involved in making a claim will only be paid if it is
successful. Claims brought on such a no-win, no-fee, or no-win,
low-fee basis are essential in litigation financing and allow
people access to justice without the risk of prohibitive costs.
The main advantages of entering into a conditional fee agreement
are that the client and solicitor share the risk and the costs of
a commercial claim. If the case is unsuccessful, a client will
only have to pay a small amount, if any, of solicitors' fees and
for disbursements and expenses.
Advantage Litigation Services are experts in the funding options
available for commercial claims and litigation. We help our
clients avoid up-front costs and reduce the financial
risks associated with taking legal action.
Litigation funding options
No-Win, No-Fee Agreements
A no-win, no-fee arrangement, also known as a conditional fee
agreement, can be used in all forms of civil litigation, including
commercial disputes. It is an agreement between a solicitor and
client whereby a client will only pay the solicitors' fees, and an
additional success fee, if the case is successful. When the case
is successful, the solicitor's fees are usually recoverable from
the losing party. If the case is unsuccessful, the client will not
pay any of the solicitors' fees nor a success fee.
The success fee is separate from the basic fees normally charged
and provides the incentive for a solicitor to take the case. In
commercial disputes, the success fee is a percentage of what the
fees would have totaled, based on basic charges, had the funding
arrangement not been applied. When a solicitor is negotiating a
no-win, no-fee arrangement and the level of success fee (which
cannot amount to any more than 100% of the basic charges), they
will take into account the likelihood of winning the claim, the
potential to settle and the costs that might be incurred.
In most cases, conditional fee agreements only apply to solicitor
fees. Whether the case is successful or unsuccessful, all
disbursements (such as court fees, counsel fees, expert fees, and
travel expenses) will still be payable by the client.
Although the client is liable for any solicitor fees, a success
fee, and disbursements if their claim is successful, it is
possible to seek payment of some of those costs from their
opponent. Should the opponent be successful, the client will be
liable for the opponent's costs. However, insurance is available
to cover the costs of a successful opponent. Advantage Litigation
Services can help you find the necessary insurance coverage to
ensure legal costs and any potential liabilities are affordable.
The precise terms of a no-win, no-fee arrangement, such as the
meaning of success and the success criteria, are specific to the
circumstances of the commercial claim being pursued. Contact us
today to see whether you have a commercial claim and a solicitor
will work on your behalf under a no-win, no-fee agreement.
A no-win, low-fee arrangement, known as a partial conditional fee
agreement, can also be used in all forms of civil litigation.
Under this type of agreement, a client will pay the solicitor's
fees at a reduced rate throughout the course of the claim. If the
case is successful, the client will also pay a success fee. When
the case is successful, the solicitor's fees already paid are
usually recoverable from the losing party. If the case is
unsuccessful, the client will pay the solicitor's fees at a
reduced rate only.
As with full conditional fee agreements, the success fee is the
incentive for a solicitor to take the case. It is a percentage of
what the fees would have totaled, based on basic charges and not
exceeding 100%, had the funding arrangement not been applied. It
is also the case that partial conditional fee agreements only
apply to solicitor fees. Whether the case is successful or
unsuccessful, all disbursements (such as court fees, counsel fees,
expert fees, and travel expenses) will still be payable by the
Although the client is liable for any fees and disbursements if
their claim is successful, it is possible to seek payment of some
or all of those costs from their opponent. Should the opponent be
successful, the client will be liable for the opponent's costs.
However, insurance is available to cover the costs of a successful
The precise terms of a no-win, low-fee arrangement, such as the
success criteria and the reduction that will be made to the fees
normally payable, are agreed upon on a case-by-case basis. Contact
us today to see what litigation funding options may help you make
a claim without putting your personal finances at risk.
Third Party Funding
Third-party funding is where a private commercial litigation
funder, with no interest in the claim, agrees with a person or
business to pay for all or some of the costs involved in
litigation under a litigation funding agreement. If the claim is
successful, any monetary award made will be shared with the person
or business that pursued the claim and the funder that paid for
it. If the claim is unsuccessful, the funder cannot reclaim any of
the money it has spent and the losing party isn't liable for any
of the costs.
In most cases, third-party funding will only be available for
commercial claims that have a very high value and a strong chance
of success. This is so the litigation funder isn't taking on too
much risk when paying for legal action it has no direct
involvement in. It will usually also be a requirement for the
person making the claim to have insurance protecting themselves,
and therefore the funder, from paying any of an opponent's costs
should the claim fail.
The amount a litigation funder will take in the event that a claim
is successful will be decided when the terms of a litigation
funding agreement are negotiated. In most cases, the amount will
either be a percentage of any damages recovered, a multiple of the
total amount paid by the funder, or a combination of the two.
Although third-party funding means sacrificing part of a financial
award if the claim is successful, it allows an individual or
business with a good and strong claim to take legal action without
any risk to their personal finances.
The most common way of funding litigation is by paying a solicitor
an hourly rate for the work they do in relation to a claim. Costs
and fees are payable throughout the course of a claim when
litigation is funded in this way.
Individuals or businesses with goods claims needn't be discouraged
from getting the justice they rightfully deserve if their
solicitor charges for legal services at an hourly rate. It may be
possible to negotiate the rate payable to reflect the particular
circumstances of the client and their claim. It may also be
possible to get insurance protecting against the risk of being
liable for an opponent's costs should the claim fail.
Whether you're an individual or a business, enforcing your rights
in a civil court needn't be a costly way of resolving a legal
problem. At Advantage Litigation Services we have the expertise to
help you find the most cost-effective way of solving your
particular commercial dispute.
How to get litigation funding
If you are thinking about taking legal action against another
individual or company but are confused about your funding options,
Advantage Litigation Services can advise. We can help you find the
most cost-effective solution for your circumstances. Contact us today.