One of the ways to fund a personal injury claim is by means of legal aid.
Advice and assistance is available to cover the preliminary work, including intimating the claim and negotiating with the third party or their insurers.
If the negotiations break down for any reason, you will need to raise a court action if you are going to achieve a fair settlement of your claim.
Under legal aid, you need to apply for Civil Legal Aid, which requires various forms to be completed. This includes providing details and vouching of your income and capital. The application is then submitted to the Scottish Legal Aid Board (SLAB) via an online system.
SLAB have various tests they apply in determining whether civil legal aid should be granted.
This includes such things as:
- the value of the claim (and whether this is significantly in excess of any offers that have been made already to settle your claim);
- the prospects of success (anything less than 50% chances of success is going to make it very difficult to get legal aid or any other type of “insurance” for a court action);
- whether a privately-funding individual would consider this to be a case which it was reasonable/realistic to take to court;
- the prospect of actually recovering from the other side any financial award which is made by the court (whether the other party is insured will be an important element here).
If SLAB decide to make you an offer of legal aid, it will be with a contribution or without.
In this article, we are going to discuss the significance of a financial contribution for civil legal aid in the context of a personal injury claim.
It’s easy to think that legal aid is “free” but that is not the case and the legal aid board repeatedly emphasise that fact across various types of court action.
If you are assessed as having to pay a financial contribution for civil legal aid, it could run into thousands of pounds. The legal aid board will collect your contribution from you over a period of months, typically at least 20 months. Payments are usually made via standing order or direct debit.
The main benefit of legal aid is where a person qualifies for legal aid without any contribution at all.
In that situation, the opponent is rather in a lose-lose situation.
Relative to a personal injury claim, they will lose out financially if the claim against them is successful because they will have to pay compensation, the other side’s legal expenses and their own legal expenses. If their defence is successful, on the other hand, it is unlikely that they will recover their legal costs from the legal aided party (the reason for this is explained further, below). In other words, at best, they will still be out of pocket to the extent of their own legal costs, win or lose.
Where the legally-aided person has a contribution, there is no real problem provided the claim is successful.
In that case, the legally-aided person will recover compensation, their legal expenses and any contribution they have paid to the legal aid board by the time of settlement of the claim will be repaid to them in full (i.e. they get their contribution back).
Where the legally-aided person has a contribution and a court action is unsuccessful, although the primary position is that the court will award the expenses of the action against them, the solicitor for the legally-aided person can make an application to the court to “modify” expenses.
- In the case of someone with legal aid who has no contribution, the court would usually* modify expenses to nil.
- In the case of someone with legal aid who has a contribution, the court would usually* modify expenses to the level of their legal aid contribution.
*We say “usually” because the court always has a discretion in this matter and it is never certain that a particular level of modification will happen, though it is the usual case.
Say a person has civil legal aid with a contribution of £1,900.
In that situation, the worst case scenario for them in all probability is that they will have to pay their legal aid contribution in full and, in the event that the court action is unsuccessful, they will have to pay the other side’s expenses up to the level of your legal aid contribution. In other words, this would be a probable total of “2 times £1,900” – i.e. £3,800 – of which £1, 900 would be paid to SLAB and £1, 900 towards the other side’s legal costs.
There is still a benefit to you in this situation in that:
- £1,900 would probably be a lot less than your own legal costs, even at legal aid rates, so SLAB would pay your solicitor the balance; and
- £1,900 would probably be a lot less than the other side’s legal costs, so they would still be out of pocket by thousands of pounds.
Of course, the strength of these arguments varies depending on the level of your civil legal aid contribution. Contributions many times higher than £1,900 are possible. Even at that level, the combined total of £3,800 is a significant amount of money for anyone and probably a deterrent to most people to take up an offer of civil legal aid.
You need to take into account other benefits of legal aid.
For example, it is quite possible that the fact that you have legal aid and you go on to raise a court action will finally bring the other side to the negotiating table and encourage them to make a settlement offer, if they have not done so already.
Also, as mentioned above, even with a contribution, legal aid is probably saving you significant costs and risks as against what a privately-funding client would have to pay for legal representation in the same situation.
What about no win-no fee?
It’s true that, when compared to civil legal aid with a contribution, no win-no fee seems much more attractive.
Certainly, the financial risk to you is eliminated.
From your solicitor’s point of view, civil legal aid is more attractive than no win-no fee because it offers a lower level of risk. It means that your solicitor can be paid something further work whether the claim is successful or not. A caseload which includes at least some civil legal aid cases is lower risk for the solicitor.
In addition, there are certain types of cases which just seem to be inherently more risky. Slipping accidents based upon public liability – or even occupiers’ liability – are cases we would put in that category and therefore cases we would feel much happier handling under legal aid, if possible, rather than on a no win-no fee basis.
It depends to a large extent on the level of any financial contribution you are asked to pay for the purposes of civil legal aid.
At the one extreme, having no civil legal aid contribution puts you in a strong negotiating position because, in some ways, the opponent is in a lose-lose situation.
At the other extreme, apart from the fact that no one can afford to budget for a civil legal aid contribution of many thousands of pounds, it makes no practical sense to accept such an offer of civil legal aid in most cases because the main benefit (the advantage on costs/expenses if your claim fails) will have gone.
In the middle, there is a difficult choice to be made and it is a matter of weighing up a range of matters including the likely value of your claim on full liability, the prospects of success and so on.
How we can help
In this article, we have tried to explain why it matters if you have a contribution for Civil Legal Aid in the context of a personal injury claim.
If you have any questions arising from this article or regarding the wider personal injury claims service provided by Moray Claims/Grigor & Young LLP, please get in touch with us. We are happy to try to answer any queries. For example, questions based on articles on this website and on the Grigor & Young website allow us to review the content, update it and expand it.