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Civil > Funding appendix > Flashcards

Funding appendix Flashcards

1
Q

types of financial support to help fund litigation

A
  1. legal aid funding
  2. no win no fee (CFA, DBA)
  3. insurance
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2
Q

Relevant professional conduct issues

A

O(1.13) - give information about costs at outset and as matter progresses

IB(1.13), (1.15), (1.16) - ensure he/she has considered with client how client will fund own cost and possibly opposition’s cost (advise on potential liability, and that other side may not be ordered to pay costs or be able to)

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3
Q

WHAT IS LEGAL AID FUNDING

A

funding for legal cases provided by the government

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4
Q

LASPO 2012

A

Legal Aid, Sentencing and Punishment of Offenders Act 2012

  • changing legal aid to reduce public spending
  • LAA replaces Legal Services Commission
  • rationale: many claims now taken on by solicitors using ‘no win no fee’ arrangements

LAA = Legal Aid Agency

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5
Q

what is EXCLUDED from legal aid

A
  1. ALLEGATIONS OF PERSONAL INJURY OR DEATH (except allegations of clinical negligence in cases of severely disabled infants or there is significant public interest involved)
  2. CONVEYANCING, BOUNDARY DISPUTES, WILLS, TRUST LAW, DEFAMATION, MALICIOUS FALSEHOOD, COMPANY AND PARTNERSHIP LAW, and other matters arising out of carrying on a business (incl. contract claims)
  3. EMPLOYMENT CASES, breach of statutory, negligence, consumer cases, education cases
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6
Q

what is iNCLUDED in legal aid

A

MUST be matter of English law…

  1. HOUSING MATTERS (where home is at immediate risk)
  2. JUDICIAL REVIEW
  3. CERTAIN FAMILY PROCEEDINGS
  4. CLINICAL NEGLIGENCE claims relating to birth injuries
  5. Claims AGAINST PUBLIC AUTHORITIES
  6. MENTAL HEALTH AND IMMIGRATION
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7
Q

will client qualify for legal aid?

A

IF INDIVIDUAL (so partners in business partnership may be included)

and:

ONE - SUFFICIENT MERIT to be accepted by LAA as care that should be funded

TWO - client must have SUFFICIENTLY LOW MEANS

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8
Q

LEGAL AID - merits test

A

consider likely prospect of success

  • 80% = very good chance of obtaining sucessful outcome
  • 60-80 = good chance
  • 50-60 = moderate chance

consider:

  • will claim win more than is spent
  • is alternative funding avaliable (if yes, no LA)
  • suitable for small claims?
  • any alternatives to litigation (e.g. complaints procedure not exhausted)
  • unreasonable to fund case from public purse
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9
Q

Legal aid - means test

A

Client must be ‘financially eligible to receive legal aid’

  • partner’s capital and income is taken into account
  • if receive benefits = automatically eligible
  • if exceed max. levels = no LA

financial limits
CAP - £8000 (bank, items, equity in prop)

INCOME - £733 per month disposable income
- deduct, income tax, NI, housing costs, child support payment, fixed amounts for each dependent relative and child living with client

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10
Q

types of legal aid

A
  1. legal help
  2. help at court
  3. legal representation - (1) investigative help, (2) full representation
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11
Q

legal aid - legal help

A

Providing initial advice and assistance with legal problem

Helps client who might need solicitor in preparing case for court

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12
Q

legal aid - help at court

A

Allows solicitor to speak on client’s behalf at certain court hearings

BUT not acting formally on their behalf or going on the record in the case

E.g. assisting client on stand-alone hearing rather than doing the entire claim

Not suitable for a final contested hearing

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13
Q

legal aid - help at court (how to qualify)

A

Satisfy financial conditions

Show that having someone speak on their behalf is (1) reasonable, (2) cost-effective and (3) likely to be of real benefit to them

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14
Q

legal aid - legal representation

A

allows client to be represented in court

covers preparation for & advocacy at a final hearing in contested proceedings

ONE - investigative help
TWO - full representation

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15
Q

legal representation, (1) investigative help

A

investigating the strength of the claim

Once investigation complete, claim will either not proceed or an application for full representation (see below) will be made

QUALIFY:

  • prospect of success not clear
  • investigation likely expensive
  • legal help suffices for investigation, if small case
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16
Q

legal representation (2) full representation

A

Main form of legal representation

All work to trial and beyond may be covered

Funding certificate will limit the terms of work and amount of costs that solicitor can incur

When limit is reached, or about to be exceeded, solicitor will need to apply to LAA for extension of existing limit

17
Q

statutory charge

A

if client gains or keeps money/property at end of case - they may have to repay some or all of legal aid costs

if shortfall in recovery of costs (e.g. court orders costs £4000, but LAA costs is £5000) - LAA will exercise its right to apply STATUTORY CHARGE OVER DAMAGES/PROPERTY RECOVERED/PRESERVED (i.e. £1000 from damages)

OR might let client repay legal costs at later date but register charge on home to secure debt with interest charged on this

solicitors should ensure this is explained fully to client (might be that a % or all client’s damages used to pay costs)

18
Q

no win no fee - two types

A

if lose - no fee
if win - normal fee AND

CFA - uplift/success fee out of C’s damages

DBA - percentage of damages recovered by C to solicitor

NB. Damages have been increased 10% in claims for contract/tort for non-pecuniary loss to assist claimants in paying sucess fee

19
Q

CONDITIONAL FEE AGREEMENTS (CFA)

A

If client loses = no fees
If win = normal or higher fees

if personal injury - success fee cannot exceed 25% of damages (excl. damages for future care and loss)

other cases - success fee can be 100% of basis fee

20
Q

CFA lawful and enforceable if

A

satisfies s.58 CLSA 1990
AND any requirements prescribed by Lord Chancellor

(currently contained in CFA Regulations)

21
Q

CFA - if client wins

A

pay solicitor:

  • basic fee
  • disbursements
  • success fee
  • insurance premium

recover from other side

  • yes except:
  • success fee (this is paid out of damages unless CFA entered into before 1 April 2013)
  • insurance (unless taken out before 1 April 2013 or clinical negligence expert report)
22
Q

CFA - if client loses

A

pays

  • disbursements
  • insurance premium
  • other sides cost
  • possibly damages (if counterclaim sucessful)

recover from other side?
- nothing

THUS, C may enter ATE insurance (cost of premium not recoverable from other side now, after 1 April 2013)

solicitor should check if client has any BTE insurance (e.g. motor/home) but no need to embark on ‘treasure hunt’

23
Q

DAMAGE BASED AGREEMENTS

A

If lose – no fees recovered
If win – recover fees out of damages awarded to client

MAX AMOUNT:
personal injury - 25% of damages (excl. damages for future care and loss)

Emp. tribunal cases - 35%

other cases - 50%

24
Q

do u need to inform other side of funding arrangements?

A

NO
- no longer duty to tell other side (because can’t recover success fee and ATE insurance premium from other side)

  • BUT must tell if client receives legal aid funding
25
Q

types of insurance

A

BTE

ATE

26
Q

BTE insurance

A

taken out before client becomes involved in litigation

Provides client with indemnity for the cost of any legal fees incurred as a result of future litigation

  • cannot recover premium from other side
  • low premium (1% of cover sought)
  • might have financial limit
  • might stipulate only meet stated proportion of costs
27
Q

ATE INSURANCE

A

taken out to help client cover cost of litigation once dispute has already arisen

  • often used with CFA
  • whether avaliable depends on level of cover required and merits of case
  • more expensive than BTE (can exceed 25% of insurance cover sought)
  • premium not recoverable if entered after 1 April 2013 from other side
28
Q

other types of funding

A
  1. Private funding (own private resources)
  2. Professional funding (by Trade Union or professional union)
  3. Third party funding (often a firm set up for this purpose, to enable parties to bring their case to court – provided by banks, private equity firms, hedge funds)

Civil (15 decks)

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