You too could have your day in court

THE COST of going to court deters all but the very poor, who may get legal aid, and the very rich, who can afford to pay from their own pockets. This has traditionally ruled out legal redress for the middle earners, the vast majority of us, who could be financially ruined if the case ends in defeat.

In a bid to open civil justice to more people and find new ways of funding cases, the Lord Chancellor, Lord Irvine of Lairg, is currently reforming the system (see box). He also hopes to save the Government millions, in part by curtailing access to legal aid, which cost pounds 1.477bn in 1997. That works out at pounds 57 for every taxpayer.

His proposed changes should leave anybody seeking compensation - for example, after a motor accident or workplace injury - with two options for meeting their legal expenses: the new conditional fee system, or insurance cover.

Under the conditional fee scheme, better known as "no win, no fee", a lawyer agrees to take on your case. If you win, you pay him or her an enhanced fee. This is known as a "success fee" and should be no more than double the lawyer's normal fees (the average is an extra 43 per cent but you could negotiate less).

If you lose, your lawyer receives nothing. You may still have to pay your opponent's legal costs and any court and expert witness fees, but these can be covered by insurance taken out at the start of the case.

Accident Line Direct is a conditional fee scheme for personal injury cases backed by the Law Society and run through local solicitors. This insurance costs pounds 100 for motor accident cases and pounds 160 for all other injuries. Under the scheme a solicitor will give you a free initial interview to judge the likelihood of your case succeeding.

No win, no fee is not the only option. You could take out an annual insurance policy, adding it on to your buildings or contents cover, or on to motor insurance, which should fund legal action in certain cases. The DAS Family Plus legal expenses insurance policy costs around pounds 15 a year and will cover a family for any legal action where there is a slightly better than evens chance of winning. Cover includes injury caused by accident at work or medical negligence, employment and consumer disputes, property problems and tax disputes. Criminal and divorce cases are excluded.

Sally Cresswell, marketing manager at DAS, says this scheme offers a better chance of finding legal backing than no win, no fee. She claims solicitors will only take on cases with a 75 per cent chance of winning.

If you have no insurance but still wish to pursue a case, you have another option, known as "after-the-event" insurance.

LawAssist, run by Greystoke Legal Services through 1,500 solicitors nationwide, covers you against the possibility of losing a case as well as providing a loan in advance to cover disbursements (costs such as expert witnesses and medical reports) and even the initial insurance premium. You do not have to pay anything until the case is concluded, when you can pay the money borrowed plus interest from damages awarded should you win, or through the insurance if you lose.

The initial cost of assessing your case is pounds 39.95 and there is no means testing. You decide on the amount to insure against losing.

The premiums may seem high. For example, in a recent successful medical negligence case, the premium for pounds 10,000 cover for both sides' costs was pounds 1,664.

However, LawAssist says the client was awarded pounds 17,000 damages and would have paid up to pounds 4,250 in a solicitor's success fees under the no win, no fee scheme.

Brian Dunk, general manager at Greystoke, says the premium level depends on the type of case and level of sum assured. "With our scheme you don't have to put your savings on the line or get a second mortgage but you can still take your opponent all the way to court and get justice."

Cover under LawAssist is available for civil litigation, but not for criminal, defamation or matrimonial cases, nor tribunals and appeals.

Contacts: Accident Line Direct, 0500 192939; LawAssist, 0870 6060405.

law reforms

Under the Lord Chancellor's reforms most claims for money or damages will be excluded from the legal aid scheme, which will only be used for defending criminal cases, the care of children, judicial reviews and social welfare cases. Lawyers will be required to give the Legal Aid Board a precise prediction of the likely success of a case before aid is granted.

All civil proceedings, with the exception of family cases, will be covered by conditional fee agreements (no win, no fee), where lawyers receive an enhanced fee if they win, nothing if they lose.

In other proposed changes, the limit for small claims will be increased from pounds 3,000 to pounds 5,000, although personal injury claims and housing disrepair will be limited to pounds 1,000.

A new "fast-track" route through the civil justice system for cases to a maximum of pounds 15,000 (including personal injury above pounds 1,000) will be introduced, to be completed within 30 weeks. There will be a "multi-track" route for more complex, higher value civil cases. Changes will be introduced over the next year or so.