conditional fee agreement

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An agreement, which must be in writing, between lawyer and client for legal services in litigation that the lawyer will not be entitled to all or some of his normal fees if the case is lost. This is popularly known as a no win, no fee agreement. In return for accepting the risk of such an agreement, the lawyer is entitled to charge a higher fee (by claiming a higher uplift) if successful. If the claimant loses the case, he may have to pay the other party's costs. The litigation is therefore not entirely risk-free, although insurance, for which premiums are charged, can be taken out to accommodate this risk. The conditions on which a conditional fee agreement may be made (including the type of proceedings in which they are available and the maximum percentage increase in fees allowed) are prescribed by the Lord Chancellor under the Courts and Legal Services Act 1990 and the Access to Justice Act 1999. For most areas of law conditional fee agreements are unlawful, but they are allowed for certain limited categories of cases, including personal injury cases. See also maintenance and champerty; success fee.

Subjects: Law.

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