The legal costs involved in either making or defending a claim against a deceased’s Estate will be at the forefront of most peoples’ minds when considering their options. Costs can quickly escalate and if the matter proceeds to a contested trial, the costs incurred by each party can be significant.
Ultimately, it is for the Court to decide who should bear the cost of the litigation. Ordinarily, if the matter proceeds to a trial, the losing party would be required to pay the successful party’s legal costs. This assumes, of course, that the parties have not been able to agree settlement terms between themselves prior to trial (including who will be responsible for paying the legal costs).
In some instances, costs will be borne by the Estate itself rather than an individual party. For instance, if an Executor adopts a neutral position in respect of a claim against the Estate, then ordinarily their reasonable legal costs incurred in obtaining legal advice should be paid by the Estate itself.
Unfortunately, Legal Aid is not available for these types of disputes.
How much will it cost to bring a claim or defend a claim
It is very difficult to provide a “one size fits all” estimate. The costs involved will very much be dependent upon the individual facts of the case and the position adopted by the opposing party. If, for instance, the opposing party wishes to settle matters swiftly after a letter of claim has been issued or received, then it is possible that an agreement can be reached promptly which will reduce the amount of legal costs incurred. Broadly speaking, the costs involved at this stage could be between £1,500 to £4,000 plus VAT.
If matters cannot be agreed promptly between the parties however, it is normally sensible to consider alternative dispute resolution, such as mediation, at a relatively early stage in the proceedings. For a mediation to be successful, there will first have to be disclosure of all relevant documentation that exists and clarity as to what it is that each party is seeking. Each party’s costs of preparing for and attending a mediation will generally be between £8,000 and £12,000 plus VAT.
If the matter does proceed to a fully contested trial (which only rarely occurs in practice), then each parties’ legal costs could quite easily exceed £100,000 plus VAT.
We will keep our clients updated at all times with our estimate of costs for each step of the proceedings.
There are several ways in which a party to a contested probate claim could fund their claim or defence. We explore the majority of these options below.
Paying privately from your own financial resources
This is the most straightforward type of arrangement. Our fees are paid as and when invoices are rendered, which will usually occur at the end of each month. At the conclusion of the matter (and if appropriate to do so), we will seek to recover the majority of those fees incurred from the opposing party or from the Estate.
In appropriate instances, it may be possible to obtain funding from a specialist litigation lender. That lender will need to be informed of the relevant facts and they will require our view as to the prospect of your success in either successfully making or defending a claim.
The lender will also need to be informed of the size of the Estate in dispute and conduct their own credit checks against you. It will be at the sole discretion of the lender as to whether they agree to provide funding or not.
No win, no fee type arrangements
In certain matters where we form the opinion that there are good prospects of success in either proceeding with a claim or defending a claim, we may be willing to enter into a conditional fee agreement with you. A conditional fee agreement is commonly referred to as a “no win, no fee agreement”. That is, if you are not successful in your claim or defence, then you will not have to pay for the solicitor’s time for acting on your behalf. You would still, however, be required to pay for all third-party costs incurred, such as court fees and any barrister fees who are also not acting for you under a similar conditional fee arrangement. If you lose, you may also have to pay your opponent’s legal costs, however, please view the below section titled ‘Insurance to cover the cost of paying the opponents legal costs‘.
Prior to entering into such an agreement, we would need to be fully informed of the details of the claim being made and have sight of any documentation that exists. We may also need to obtain an external view as to the likely prospects of success by instructing counsel (a barrister) to provide a report on this.
Under this type of arrangement, if your claim is successful, our fees will become due and payable, together with an additional payment known as a “success fee”. This success fee will be a percentage uplift of the solicitors’ fees incurred and will represent the risk taken on by us in acting in this type of agreement.
It may also be possible to enter into a conditional fee agreement on similar terms with whichever barrister is instructed.
A deferred fee arrangement
It may also be appropriate in some cases to proceed with a deferred fee arrangement. In these situations, an agreement is reached between the firm and our client that we will not seek payment of our fees until the conclusion of the matter. Our fees will not be dependent on whether you are successful in your claim or defence. Our fees will be payable in any event.
For us to consider such an arrangement, we would need to be assured that there would be sufficient funds available to pay our estimated fees. We may also need to place a legal Charge on your property as security for our fees. This Charge would be removed when our fees are paid in full.
Insurance to cover the cost of paying the opponents legal costs
In some instances, it may be possible to obtain a specific type of insurance policy known as “After the Event” insurance. This will provide the policy holder with insurance, so that if you are not successful in your claim or defence, the insurance policy will pay the other side’s legal costs to the extent of the amount of cover obtained. This type of policy can also sometimes be relied upon to cover your own legal fees and third-party costs.
Unfortunately, the premium for these types of policies cannot be recovered from the opponent in the event of a successful claim. Therefore, the premium will have to be paid personally by you, unless a specific agreement for the payment of this premium is reached with your opponent.
It is also possible that you may already have funding and insurance cover in place under an existing insurance policy that you have. Quite often, legal expenses insurance is provided either as a standard or as an additional extra under a home contents policy. If you do have the benefit of this cover, then a discussion would need to take place between this firm, your insurer and yourselves as to the funding arrangements going forward.
To make a free enquiry, please call now on 020 8858 6971 to arrange a mutually convenient time for a telephone discussion or email us today.