No Win No Fee Libel Solicitors: How Conditional Fee Agreements Work

Can I instruct a no win no fee solicitor for a libel claim?

Possibly, but only if a solicitor offers it. “No win, no fee” is the everyday name for a conditional fee agreement (CFA). Section 58(2)(a) of the Courts and Legal Services Act 1990 defines a CFA as an agreement with a person providing advocacy or litigation services which provides for their fees and expenses, or any part of them, to be payable only in specified circumstances (legislation.gov.uk). Because it is an agreement, it exists only where a solicitor offers one and you accept its terms.

Defamation Guard is not a law firm and does not itself enter into no win, no fee agreements or give legal advice (see our disclaimer). It can introduce you to independent solicitors, who confirm their own funding terms in writing before they act. This page explains the legal framework so you can ask the right questions.

What the law requires of a conditional fee agreement

• It must be in writing. Section 58(3)(a) makes this a condition applicable to every CFA. A CFA that satisfies all the conditions applicable to it is not unenforceable merely because it is a CFA; under section 58(1) (subject to subsection (5)) any other CFA is unenforceable.
• A success fee is an increase on the normal fees. Under section 58(2), a CFA provides for a success fee if it provides for the fees to be increased, in specified circumstances, above the amount that would be payable if they were not payable only in specified circumstances; the success fee is the amount of the increase.
• The percentage must be stated and capped. A CFA with a success fee must state the percentage by which the fees are to be increased, and that percentage must not exceed the percentage specified by order (section 58(4)). The Conditional Fee Agreements Order 2013 specifies 100% for all proceedings that can be the subject of an enforceable CFA other than proceedings under section 82 of the Environmental Protection Act 1990 (articles 2 and 3), so a success fee in a defamation claim can increase the fees by up to 100%.

Who pays the success fee in a libel claim? What changed on 6 April 2019

Before 6 April 2019, section 58A(6) of the 1990 Act in its earlier form allowed a costs order to include provision requiring the payment of any fees payable under a CFA that provides for a success fee. For defamation claims that changed on 6 April 2019. The sequence, from legislation.gov.uk, is:

1. Section 44 of the Legal Aid, Sentencing and Punishment of Offenders Act 2012 (LASPO) substituted a new section 58A(6) of the 1990 Act: a costs order may not include provision requiring the payment by one party of all or part of a success fee payable by another party under a conditional fee agreement (LASPO section 44).
2. When section 44 was brought into force generally on 1 April 2013, article 4(b) of the Commencement No. 5 Order excluded “publication and privacy proceedings”, which that Order defines as proceedings for defamation, malicious falsehood, breach of confidence involving publication to the general public, misuse of private information, or harassment where the defendant is a news publisher (SI 2013/77).
3. Article 2 of the Commencement No. 13 Order 2018 brought section 44 into force on 6 April 2019 in relation to publication and privacy proceedings (SI 2018/1287).

Section 44(6) of LASPO contains transitional provision for conditional fee agreements entered into before the commencement day. If you are offered a new CFA for a libel claim, ask the solicitor how the success fee would be paid and what you would be left with if you win, because a costs order may not require the other side to pay it.

What about after-the-event insurance?

Section 58C of the 1990 Act (inserted by LASPO section 46) provides that a costs order made in favour of a party who has taken out a “costs insurance policy” may not include provision requiring payment of the premium, unless regulations permit it. A costs insurance policy is a policy insuring against the risk of the party incurring a liability in the proceedings; this is the kind of policy referred to as after-the-event (ATE) insurance (section 58C).

Publication and privacy proceedings were also excluded when section 46 was brought into force. The explanatory note to the 2018 Order states that they “remain excluded from the commencement of section 46”, “meaning that premiums for after the event insurance remain recoverable by way of costs in publication and privacy proceedings” (SI 2018/1287, explanatory note). The rules can change, so ask the solicitor whether a premium would be recoverable from the other side in your claim and what any policy would cover.

What no win no fee does not decide

• Costs between the parties. A CFA is an agreement about the fees and expenses of the person providing advocacy or litigation services. Under rule 44.2(2)(a) of the Civil Procedure Rules the general rule is that the unsuccessful party will be ordered to pay the costs of the successful party, although the court may make a different order. The qualified one-way costs shifting rules in Section II of Part 44 are defined by rule 44.13(1) by reference to proceedings that include a claim for damages for personal injuries, under the Fatal Accidents Act 1976, or arising out of death or personal injury. Ask the solicitor how the risk of paying the other side’s costs would be dealt with in your claim.
• Whether the claim can succeed. However a claim is funded, the claimant must show that publication of the statement has caused or is likely to cause serious harm to reputation, and for a body that trades for profit, serious financial loss (Defamation Act 2013, section 1). See our guide to the serious harm test.
• The time limit. Section 4A of the Limitation Act 1980 provides that no action for libel or slander may be brought after one year from the date the cause of action accrued, so it is worth raising funding with a solicitor early. See defamation solicitors: a guide for more on timing.
• Whether the other side knows how you are funded. The Pre-action Protocol for Media and Communications Claims says the Letter of Claim should include details of any funding arrangement in place (paragraph 3.1), so expect the other side to be told.

Is legal aid an alternative?

Civil legal services provided in relation to defamation or malicious falsehood are listed as excluded services in Part 2 of Schedule 1 to LASPO (legislation.gov.uk). Funding is therefore usually a private arrangement with the solicitor. Our fees and funding guide describes the fixed-fee and hourly-rate arrangements as well as CFAs.

Questions to ask a no win no fee libel solicitor

• Is the agreement a conditional fee agreement, and will I receive it in writing before you start work?
• What success fee percentage will it state, and how is it calculated?
• Who pays the success fee if I win, and what would I receive after it is paid?
• What fees and expenses are covered by the agreement, and what would I still pay myself?
• What happens to the agreement if I settle, withdraw or lose?
• How would the risk of paying the other side’s costs be dealt with, and is after-the-event insurance suggested?
• What is your estimate of the likely overall cost at each stage?

Solicitors regulated by the SRA must give clients the best possible information about how their matter will be priced and about the likely overall cost (Code of Conduct, paragraph 8.7). Our solicitor selection checklist helps you compare firms side by side.

Frequently asked questions

Sources

• Courts and Legal Services Act 1990, section 58 (conditional fee agreements)
• Courts and Legal Services Act 1990, section 58A (supplementary; subsection (6) on success fees)
• Courts and Legal Services Act 1990, section 58C (recovery of insurance premiums by way of costs)
• Legal Aid, Sentencing and Punishment of Offenders Act 2012, section 44 (success fees), including commencement information
• Legal Aid, Sentencing and Punishment of Offenders Act 2012, section 46 (insurance premiums), including commencement information
• Legal Aid, Sentencing and Punishment of Offenders Act 2012, Schedule 1, Part 2 (excluded services)
• The Legal Aid, Sentencing and Punishment of Offenders Act 2012 (Commencement No. 5 and Saving Provision) Order 2013, articles 1 and 4 (SI 2013/77)
• The Legal Aid, Sentencing and Punishment of Offenders Act 2012 (Commencement No. 13) Order 2018, article 2 and explanatory note (SI 2018/1287)
• The Conditional Fee Agreements Order 2013, articles 2 and 3 (SI 2013/689)
• Civil Procedure Rules, Part 44 (general rules about costs), rules 44.2 and 44.13
• Pre-action Protocol for Media and Communications Claims (Civil Procedure Rules, justice.gov.uk)
• Defamation Act 2013, section 1 (serious harm)
• Limitation Act 1980, section 4A (time limit for defamation)
• SRA Code of Conduct for Solicitors, RELs, RFLs and RSLs, paragraph 8.7

This page is general information, not legal advice. Defamation Guard is an information and referral service and is not a law firm. See our disclaimer. The law is stated as at the date of the sources above; check the current position with an independent solicitor.