Many Personal injury solicitors take on Personal injury cases on a “no foal, no fee, otherwise known as no win, no fee” basis. This means that you the injured person will not be charged a fee by your Personal injury solicitor if you do not win the case. This is most common in personal injuries cases.
This phrase can be very often extremely misleading as it can suggest to a client that there will be no costs incurred by them in the event that they are not successful in their Personal injury claim. However you may still be liable for the other side’s fees and their own medical expenses, barrister’s fees, etc.
The origin of the term No Foal No Fee comes from the horse industry where if a mere did not produce a foal then there were no stud fees paid.
Irish law firms are controlled by the Law Society of Ireland and they are not allowed to advertise No Win No Fee agreements. They are allowed to negotiate with clients No Win No Fee agreements when they are in consultation. Similarly, Personal injury solicitors are not allowed to charge commission or a success fee when they win a personal injury claim for a client. The Law Society of Ireland requires all their member law firms to include the following statement on all documentation, advertising and websites, “In a contentious business a solicitor may not calculate fees or other charges as a percentage or proportion of any award or settlement.”
The advertisement by Personal injury solicitors of such No Foal, No Fee or No Win No Fee agreements is not allowed by the Law Society of Ireland which is the governing body of Solicitors in Ireland.
Other phrases with the same or similar meaning are equally not allowed by the Law Society of Ireland. Such phrases as ‘complimentary consultation’, ‘complimentary case evaluation’, ‘no bill until you win’, ‘our service will not cost you a penny’, ‘we will fund your case’, and ‘a solicitor cannot advertise to act on a No Win No Fee basis . The flip side is that Personal injury, solicitors can act on this basis and these sublets can be discussed by phone, email or in a meeting.
There are other areas of business that use the term No Foal No Fee. The recruitment business typically operates on a No Foal, No Fee basis. Simply put, it means that the client does not pay until and unless the recruiter finds someone who joins their company or business.
Some people think that it is almost free, yet the final fee when the right candidate is found is always considered expensive.
The big problem with No Foal No Fee is there is both no upfront cost and joint commitment. It seems easy and without consequence, to for a company to send out a request to a few agencies. The client thinks they now have the agencies doing work, trawling the market and the CV’s for the very best talent and that on top of their own efforts, they are sure to find someone.
But what’s really happening behind the scenes?
Firstly, finding the right talent for the job takes time and skill. If it was that easy to find the right person, companies will do it themselves.
So identifying the right person involves the agencies putting in years of the building of knowledge of the market place in question, and then days of analysis and searches, of talking to prospects, that involves the judging their skills and importantly, their culture fit and career aspirations. After that is complete then there is the managing of an often long and complex interview and feedback process. The whole procedure, which cannot be rushed, often it can take several weeks from start to finish. Many people think that it is the result of a quick database check of CV’s.
As you can see there can be a lot of disadvantages of a No Foal No Fee situation.
Some organisations have criticised Personal injury solicitors for operating a No Foal No Fee policy in a climate where fraudulent claims are costing business.
Some say that fraudulent claims against businesses and private policyholders are often succeeding because of the No Foal, No Fee basis on which Personal injury solicitors are taking on cases.
The cost of claims, including legal costs, was so ridiculously high that often the advice was to settle a dubious case and avoid the significant costs which would occur in fighting the case.