The new Conditional Fee Agreement regime is now upon us and is likely to raise numerous questions, not least because of ill thought out legislation and lack of consultation with those of us at the sharp end of the industry. One area where problems are likely to arise is in that of clinical negligence claims funded by a CFA .
Assume that the solicitor is acting for the client under a CFA in which there is agreement that the Claimant will pay an uplift of 25% of general damages received for pain, suffering and loss of amenity as well as past losses and expenses. What possible difficulties can we expect:
Global settlements – where a global offer is made – particularly in cases where the agreed damages are substantial – how does the Claimant or his solicitor know the portion which applies to general damages and past losses? If that cannot be established, how can the uplift be calculated;
Interim payments – where a substantial interim payment has been made, for example in order to pay for new accommodation and 24 hour care which is required by the Claimant due to his injuries, a situation is likely to arise whereby the Claimant, having deducted the interim payment and the percentage of damages payable to his solicitor, could be left with almost nothing from the settlement to assist him in his life going forward;
Delay in resolving the claim – the longer it takes to settle a claim, the higher the past losses will be and, consequently, the higher the proportion of the damages will be paid to the solicitor at the Claimant’s or Law costs draftsmen expense;
One possible solution would be to agree in advance a fixed amount as the uplift, subject to the legal cap. Alternatively solicitors and their clients could agree a graded uplift, with the fee increasing as the total damages increase. This, once again, would be subject to the maximum allowed under the new regime. Whatever the answer, there are likely to be some hiccups along the way.