This column is written by Andrew Newton, a partner at Maxwell Entwistle & Byrne solicitors, who is a member of the Law Society's specialist Personal Injury Panel and is based at the practice's West Kirby office:-

AFTER the abolition of Legal Aid in April last year, the government introduced legislation covering conditional fee agreements - better known as the no win, no fee agreements - in order to ensure access to the courts without the worry of having to pay legal costs if unsuccessful.

The conditional fee agreement is backed by an insurance policy which ensures payment of the other side's legal costs if the claim is unsuccessful.

At Maxwell Entwistle & Byrne Solicitors the insurance premium is paid upfront for clients and recovery of the premium sought from the other side at the end of the case. Prior to April of last year, the premium was deducted from the compensation at the end of the case but under new legislation it is recoverable.

The insurance industry is now trying to argue that the insurance premium is not payable by them unless court proceedings have been issued. Given that the majority of cases settle without the need to issue court proceedings, this issue will need to be resolved by the courts.

If the claim is unsuccessful, at Maxwell Entwistle & Byrne clients pay nothing. Because they are members of the Law Society Personal Injury Panel, they offer Law Society-approved insurance which they can recover, subject to the above, from the other side at the end of the case.

The insurance premium must be reasonable. Some claims management companies unable to offer Law Society-approved insurance have been unable to recover the insurance premium on behalf of their clients. The cost of the premium has subsequently been deducted from clients' compensation and this has led to reports of people receiving no compensation or seriously reduced awards.

It is for these reasons that it is important to seek professional advice from a solicitor and to ask what the position is if you win your case - as this can differ depending upon whom you instruct to deal with your claim.

Andrew Newton, a partner at Maxwell Entwistle & Byrne solicitors, is a member of the Law Society's specialist Personal Injury Panel and is based at the practice's West Kirby office.