Contingency Fee Agreement Template for the UK
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What is a Contingency Fee Agreement?
A Contingency Fee Agreement lets you hire a lawyer without paying their fees upfront. Instead, you only pay if your case succeeds - typically through a percentage of the money you win. These agreements are particularly common in personal injury claims and employment disputes across England and Wales.
The agreement must follow strict rules under UK law, including clear terms about how the fee percentage works and what happens if you lose. Your solicitor needs to explain all costs and risks before you sign, and the agreement must be in writing. Most firms cap their success fee at 25% of your compensation, excluding damages for future care and losses.
Sample clauses: standard wording in a UK contingency fee agreement
5. Payment on Success
5.1 The Client shall pay the Solicitor the Payment only if the Claim succeeds, and "success" means [the Client obtains money or money's worth by judgment, award or settlement, whether or not proceedings are issued].
5.2 The Payment is [25]% of the Sums Recovered, inclusive of VAT and of any costs payable to the Solicitor by the opponent, and shall be deducted from the Sums Recovered when they are received into the Solicitor's client account.
5.3 In a claim for personal injuries, the Sums Recovered exclude any damages for future pecuniary loss and, in a claim before an employment tribunal, the Payment shall not exceed 35% of the Sums Recovered, in each case as required by the Damages-Based Agreements Regulations 2013.
5.4 The Solicitor shall account to the Client for the balance of the Sums Recovered within [10] working days of receipt and shall provide a written statement showing the Payment, any expenses and any costs recovered from the opponent.
6. If the Claim Does Not Succeed, and Early Termination
6.1 If the Claim does not succeed, the Client shall pay the Solicitor nothing for the Solicitor's own time, but remains liable for [disbursements not covered by insurance] and for any costs order made in favour of the opponent.
6.2 The Solicitor has advised the Client to take out [after the event insurance] against the risk in clause 6.1, and the Client acknowledges that the premium is the Client's responsibility.
6.3 Either party may terminate this agreement on [14] days' written notice, and if the Client terminates without good reason before the Claim concludes, the Client shall pay the Solicitor's reasonable charges for work done at [£[rate] per hour], capped at the Payment that would have been due under clause 5.2.
6.4 If the Solicitor terminates because the Client has [failed to give reasonable instructions or has misled the Solicitor], clause 6.3 applies as if the Client had terminated.
Illustrative extract showing typical drafting under the law of England and Wales. Documents generated with GenieAI are tailored to your rules, standards and context.
Frequently Asked Questions
When should you use a Contingency Fee Agreement?
Consider a Contingency Fee Agreement when you have a strong legal claim but can't afford to pay lawyer fees upfront. This arrangement works especially well for personal injury cases, employment disputes, and professional negligence claims where you're seeking compensation but lack immediate funds for legal representation.
These agreements make sense when your case has good prospects of success and clear financial damages. They're particularly valuable if you've suffered injuries that prevent you from working, or when facing a well-resourced opponent. Many UK law firms offer initial consultations to assess if your case suits this payment structure, helping reduce your financial risk.
What are the different types of Contingency Fee Agreement?
- Attorney Fee Agreement: Standard agreement setting a straightforward percentage of recovery as the fee
- Contingency Fee Retainer Agreement: Combines contingency fees with ongoing retainer payments for complex cases
- Mixed Contingency Fee Agreement: Blends reduced hourly rates with a smaller contingency percentage
- Partial Contingency Fee Agreement: Client pays minimal upfront fees plus a lower success percentage
Who should typically use a Contingency Fee Agreement?
- Solicitors and Law Firms: Draft and offer Contingency Fee Agreements, ensuring compliance with UK regulations and explaining terms to clients
- Individual Claimants: People seeking compensation for personal injuries, employment disputes, or professional negligence who can't afford upfront legal fees
- Claims Management Companies: Often introduce clients to solicitors who work on contingency arrangements
- Insurance Companies: May be involved in funding arrangements or defending against contingency-backed claims
- Court Officials: Review and approve fee arrangements when assessing costs in successful cases
How do you write a Contingency Fee Agreement?
- Case Assessment: Document the claim's strengths, estimated value, and likelihood of success
- Client Details: Gather full contact information, case background, and financial circumstances
- Fee Structure: Calculate and clearly outline the percentage fee, considering the 25% cap on general damages
- Cost Breakdown: List potential disbursements, court fees, and any other expenses the client might face
- Risk Assessment: Detail potential outcomes, including losing scenarios and cost implications
- Documentation: Prepare clear explanations of all terms in plain English, ensuring compliance with UK regulations
What should be included in a Contingency Fee Agreement?
- Client Information: Full names, addresses, and contact details of all parties involved
- Case Description: Clear outline of the legal matter and services covered
- Success Fee Terms: Percentage to be charged, capped at 25% of general damages
- Payment Structure: Detailed breakdown of when and how fees will be calculated and paid
- Risk Disclosure: Clear explanation of potential outcomes and client responsibilities
- Termination Rights: Conditions under which either party can end the agreement
- Regulatory Compliance: Statement confirming adherence to UK Solicitors Regulation Authority rules
What's the difference between a Contingency Fee Agreement and a Fee Agreement?
A Contingency Fee Agreement differs significantly from a standard Fee Agreement in several key aspects. While both govern legal fees, their payment structures and risk allocation work quite differently.
- Payment Timing: Contingency fees are only paid upon successful case resolution, while standard fee agreements require regular payments regardless of outcome
- Risk Distribution: Contingency arrangements share risk between lawyer and client, as the lawyer only gets paid upon success. Standard fee agreements place financial risk primarily on the client
- Fee Calculation: Contingency fees are calculated as a percentage of damages awarded (capped at 25% in UK), whereas standard fee agreements typically charge fixed hourly rates or flat fees
- Case Types: Contingency arrangements are mainly used for compensation claims, while standard fee agreements cover all types of legal work
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About the Contingency Fee Agreement
- Case Assessment: Document the claim's strengths, estimated value, and likelihood of success
- Client Details: Gather full contact information, case background, and financial circumstances
- Fee Structure: Calculate and clearly outline the percentage fee, considering the 25% cap on general damages
- Cost Breakdown: List potential disbursements, court fees, and any other expenses the client might face
- Risk Assessment: Detail potential outcomes, including losing scenarios and cost implications
- Documentation: Prepare clear explanations of all terms in plain English, ensuring compliance with UK regulations
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