What is a Success Fee on a Personal Injury Claim?

A success fee is an additional fee on top of the basic standard hourly rate that a solicitor may charge if you win your personal injury claim funded on a ‘no win, no fee’ basis.

In a personal injury claim there are two liabilities for your lawyers costs if you win your case,

• basic charges,
• success fee on top.

These are the legal costs liabilities that you normally incur if you win your personal injury claim funded on a ‘no win, no fee’ basis. These two items are added together to make your total liability for your solicitors’ charges. 

In the video below Dominic Moss explains all about what a success fee to help you understand more about how this may affect the cost of your claim.

What is a Success Fee on a Personal Injury Claim – Video Transcript

Hi, my name is Dominic Moss from Stonehewer Moss Solicitors and today I want to talk about success fees in personal injury cases. We often get asked what is a success fee? Why is it that I have to pay it? If I do have to pay it, why is it usually 25% plus VAT? I’d like to answer all those questions today and go through them and hopefully by the end of it you’ll understand a little bit more about success fees and what you need to be thinking about if you’re wanting to make a personal injury claim.

First of all, what is a success fee? Well back in the old days when I first started doing this, solicitors used to get paid their costs by the other side and the client didn’t have to make any contribution towards their costs at all. These days that isn’t the case unfortunately and clients have to make a contribution, that contribution is made up of two items. One being the basic legal costs that you have to pay, and the other one being the success fee and the success fee is there to compensate solicitors for cases that they don’t win when they’re acting under a no win, no fee agreement.

The second element is, is it always 25%? Well, the short answer to that is no, no it’s not. It might be 25% plus VAT and in a lot of cases it is 25% plus VAT, but these days many lawyers are looking at funding in cases in a different way. Sometimes if you pay privately, you might not pay any percentage and certainly with Stonehewer Moss there isn’t a blanket 25% plus VAT rate, in many cases people pay a lot less or even pay no success fee (it is your liability to costs that is limited to 25% plus VAT)

Thirdly, why do you have to pay it? I’ve touched on that but just to go a bit further in respect of why do I have to pay, it is because the defendants don’t have to pay all of your legal costs these days. So if you win your case, the time the solicitors spent dealing with your case isn’t going to be paid for in full and therefore there has to be some way of getting the pot of money that you pay and we encase to be enough to justify the work that’s included in acting for you. Now that, as I say, is made up of the two elements, the success fee and the basic legal costs. At Stonehewer Moss we often don’t charge a success fee at all, but that doesn’t mean you’re not liable to pay our basic legal costs, which might be many thousands of pounds. But in order to make it so that it’s worth you making a claim and not paying out more money than you’re getting back, we limit your contribution from your claim from the money that you receive in compensation to no more than 25% plus VAT of that as a payment towards our basic legal costs. So in many cases where we act overall you’re only going to pay out 25% plus VAT of what it is that you’ve actually recovered in compensation.

The best way of actually finding out what your position is going to be in respect of your case (because there’s lots of different types of cases and lots of different types of risk), some cases are cheaper to run, some cases are easier to run. So the only way of really finding out what it is that you’re likely to pay is to ask and I’d suggest that you give us a call, I’ll go through it with you, you’re under no obligation. I’d also suggest that you give somebody else a call and go through it with them because if you speak to somebody else and they tell you no there’s a flat rate of 25% plus VAT, then you’ll know that what we’re offering is probably going to beat that. Any questions give me a call, I’m Dominic Moss at Stonehewer Moss Solicitors and our number is 01606 872200, or go to our website stonehewermoss.co.uk.