The Legal Ombudsman has published a report today revealing that over the past year it’s ordered almost £1m to be paid out to resolve disputes where a consumer has received poor legal services for a ‘no win, no fee’ claim.

These types of claims are usually made when a person has an accident which wasn’t their fault. The law firm acts on their behalf to help secure compensation for the person’s injury.

The Ombudsman has highlighted, however, that competition within the market and increasing pressure to win new customers, has had an effect on the standards offered by these law firms.

In some instances, law firms have failed to conduct thorough assessments and as such have overestimated their chances of winning case. As a result some lawyers have exploited loop holes in agreements with customers to offset their own financial risk, which in practice has meant that some customers, upon losing their claim, have been struck with unexpected fees.

While ‘no win, no fee’ arrangements are useful in helping people get access to justice, we have, in the past dealt with concerns about how they’re advertised. We’ve banned a number of ads where the advertiser has failed to make clear and upfront where a no win no fee claim actually comes with other costs, such as a requirement to pay insurance or even the other side’s legal costs, if they should lose their claim.

No-one should be misled into paying for a service. That’s why the rules require that advertisers that are making no win no fee claims ensure that the commitment is genuinely without cost, or if that’s not the case then they must ensure that they make clear that fees could apply.

Anyone that’s concerned about an ad for a ‘no win no fee’ claim should lodge a complaint with us. We’ll take action to have any problem ad removed or amended.

Read the No Win, No Fee AdviceOnline library entry.

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