On 1 April 2000, the Government relaxed the rules on conditional charges, as a result of its policy of improving access to justice, by making the use of conditional pricing agreements and legal expenses easier and more affordable. These rules for implementing the Access to Justice Act 1999 apply only to specific pricing agreements. The government has announced that it will expand the law to allow collective agreements for contingency fees that could be used by mass suppliers and buyers or users of legal services such as unions or insurers. While this is true if the funder is also the client, it may be more important if it is not, as it offers protection to clients who might assume residual liability, for example if the funder does not provide full compensation. The provisions contained in the various contingency fee regulations which, prior to the signing of a contingency fee agreement, impose specific information on the client, for example with regard to appropriate financing methods, are deleted. Detailed instructions on the ability to reimburse successful completion fees under Practice Note: Conditional fee agreements – success fees can be found. This practice note discusses the different types of conditional royalty agreements (SAAs) and highlights specific issues for each type. For example: CFA with pass fee, CFA with no pass fee, CFA lite, discounted CFAs and specification agreements. To Reg. 3 (2) (a) “an agreement may be a conditional collective fee agreement, whether or not the funder is a client”. A funder is defined as “the part of a conditional cost collective agreement (CCFA) that, under that agreement, is required to pay the legal representative`s fees.” A consultation was held in July 2000 on a possible system of collective agreements. The Government has just published its findings after the consultation process in the document “Collective Conditional Fees” (Lord Chancellor`s Department, September 2000). The resulting collective pricing policy will allow for economies of scale, reduce the regulatory burden for businesses and membership of organisations, and continue to support their policy of improving the competitiveness of legal service providers.
The aim is to set up a system for entering into agreements between mass providers of legal services and large consumers on behalf of themselves and others, in order to “widen the pathways to the courts for thousands of citizens”. As of April 1, 2013, when the parties finance their disputes through conditional royalty agreements (CFAs) and/or post-event insurance agreements (ATE), the CFA`s success fees and the ATE premium can no longer be reimbursed by the losing adversary if the case is successful. Parties may continue to purchase CFAs and ATE insurance to finance their disputes, but they must bear the additional costs. This article deals with the main points of the regulations available on the website of the Lord Chancellor and HMSO. The new rules allow large consumers of legal services to enter into collective agreements with lawyers for which royalties must be paid subject to reservation. The current rules continue to apply to CFAs entered into before April 1, 2013 and ATE policies entered into before April 1, 2013. . . .