Insights

Are legal costs and disbursements payable if you lose your personal injury case? 

In most cases your solicitor will act on a no win no fee basis (CFA agreement). This means that you will not have to pay their legal fees if your case is unsuccessful.  

The general rule is that if you lose your case, you do not have to pay the opponent’s costs either.  

There are however exceptions to both of these general positions.  

You should also consider disbursements. These are incurred costs that are required to progress your case, such as court fees or medical reports.  

Your solicitor’s legal fees 

If your case is unsuccessful, you will not have to pay your solicitor’s legal fees, however this is assuming that the case is allowed to run until its conclusion.  

If you were to terminate your solicitor’s instructions and instruct another solicitor in the middle of the case, you would then become liable for your solicitor’s fees up to the point that you ended your CFA agreement. This is because you did not allow your solicitor the opportunity to conclude the case successfully to be able to recover their fees from the opponent.    

You would also be liable for your solicitor’s fees if the solicitor ends the agreement due to you not performing your obligations under the CFA agreement, such as not providing your solicitor with the information they require, or being dishonest about your claim. 

If your claim concludes unsuccessfully and you have been found to be fundamentally dishonest by the court, you will be liable for your solicitor’s legal fees. This is because your solicitor was only acting on a CFA on the presumption that you were making a valid honest claim.  

Your opponent’s legal costs 

If your case is unsuccessful, you may become liable to pay your opponent’s costs if you have been found to be fundamentally dishonest about your case. You may also become liable if your case is struck out for not having any merit in the first place. 

If your opponent made an offer to settle your case which was only open until a certain date, and you rejected this offer, and you then lost your case at court, you could also be liable to pay the opponent’s costs from the last date that you could have accepted the offer. This is because the opponent would have incurred costs carrying out extra work to take the matter to trial. This extra work would have been avoided if you accepted their offer when you had the opportunity.  

In most cases your solicitor will advise you to obtain After the Event Insurance (ATE) at the outset of the case. As with your legal fees, you will not have to pay for this until the matter has concluded successfully and the cost will be deducted from your compensation. If you lose your case, you will not have to pay for the ATE. 

This ATE cover will protect you from having to pay the opponent’s legal costs if you lose the case after rejecting the opponent’s settlement offer.  

Disbursements 

These are not included under the CFA agreement, so you are required to pay for these as and when they become necessary. In some cases, your solicitor may be able to defer payment of the disbursements until the conclusion of the case so that you do not have to pay for them up front. This will not be the case for court fees which are payable if your case goes to court. If your case is successful, your solicitor will claim the cost back from the opponent.   

The ATE will also cover the cost of disbursements if your case is unsuccessful. 

Summary 

So in a nutshell, as long as you are making an honest claim, you provide your solicitor with everything they need, and you have suitable ATE cover in place, you would not normally have to pay your solicitor fees, opponent’s costs, or disbursements if your case is unsuccessful.     

If your case is unsuccessful and you are found to have been fundamentally dishonest by the court, you could be liable to pay your solicitor fees, the opponent’s costs, and your disbursements. 

*This article is not legal advice but provides a general overview. The specific details of your case will determine the best course of action.