Woodford compensation and No Win No Fee fees

MapsterUK

Oli_boy said:

If it helps. below is a draft email you can copy and adapt with your own details to request copies of all data they hold about you in connection with the Woodford case, including correspondence, questionnaires, fun

ding documents and any advice or updates sent to you. 

Perhaps if enough of us do it this the workload involved for them may make them thing twice about pursuing this.

Subject: Subject Access Request – Woodford Litigation – [Your Full Name]

To: privacy@harcusparker.co.uk

Dear Sir or Madam,

I am writing to make a Subject Access Request under Article 15 of the UK GDPR and the Data Protection Act 2018 in relation to the Woodford litigation. Please confirm whether you are processing any personal data relating to me and, if so, please provide:

• Copies of all personal data you hold about me in any form (including emails, letters, call notes, internal memos, questionnaires, schedules, and documents) in which I am identified or identifiable, specifically in connection with the Woodford litigation and any related group actions or investigations. 
• Copies of any retainer documentation, funding documentation, engagement correspondence, questionnaires, claim forms, schedules of loss, and any advice or updates sent to me regarding the Woodford litigation. 
• Information about the purposes for which you process my data, the categories of data, the categories of recipient you disclose it to (including funders, insurers, counsel, and claim administrators), and the envisaged retention periods. 
• The source of any of my personal data that was obtained from third parties (for example, funders, claims management companies, or administrators), rather than collected directly from me. 

To help you identify my records:

• Full name: [Your full name]
• Any other names used: [e.g. previous surname, if applicable]
• Postal address: [Your address]
• Email address(es) you may hold: [list]
• Telephone number(s) you may hold: [list]
• Relevant matter: Woodford litigation
• Any reference, client or claim number: [insert if known]

Please provide the response in electronic form to this email address unless you have a specific reason why that is not possible.

If you require further information to verify my identity, please let me know as soon as possible. I understand you are required to respond without undue delay and in any event within one month of receipt of this request.

Yours faithfully,

[Your name]
[Date]

Very useful, I have done this also and emailed it today.

masonic

flopsy1973 said:

Will everyone get a cut of this settlement or only people that joined the legal claims ?
Also what is the total cash payout we have received so far ?  How much money did we lose is what I want to know really ? 

The redress scheme was for all investors. The details are set out here: https://lfwoodfordfundscheme.com/wp-content/uploads/2023/10/LFSL-FCA-Investigation-Summary-final-version10271360125.1-1.pdf

It was calculated to restore 77% of the loss attributable to the mismanagement.

L2q7Y9s

I have just received an email from HP and it states

Our business model relies on contingent income from winning case and so conversely we are set up to withstand losses. What we cannot do, however, is breach our contractual obligations to our funders, as to do so would expose us to a claim against the firm for frustrating the possibility of Augusta being repaid. It is for that reason that we are compelled to invoice in this scenario, unless or until the funder agrees that we can waive our fee.  

Does this suggest the funder may yet waive the fee ? 

BungalowBliss123

L2q7Y9s said:

I have just received an email from HP and it states

Our business model relies on contingent income from winning case and so conversely we are set up to withstand losses. What we cannot do, however, is breach our contractual obligations to our funders, as to do so would expose us to a claim against the firm for frustrating the possibility of Augusta being repaid. It is for that reason that we are compelled to invoice in this scenario, unless or until the funder agrees that we can waive our fee.  

Does this suggest the funder may yet waive the fee ? 

What had you asked them?  Yes, the closing words of their email to you would appear to mean that ‘fees’ might be waived.  They should never have invoiced anyone in the first place - I just don’t understand how they can consider it a ‘win’

masonic

L2q7Y9s said:

I have just received an email from HP and it states

Our business model relies on contingent income from winning case and so conversely we are set up to withstand losses. What we cannot do, however, is breach our contractual obligations to our funders, as to do so would expose us to a claim against the firm for frustrating the possibility of Augusta being repaid. It is for that reason that we are compelled to invoice in this scenario, unless or until the funder agrees that we can waive our fee.  

Does this suggest the funder may yet waive the fee ? 

There is always the possibility that a debt will be written off in the future if you refuse to pay it. But it is impossible to say how much effort Augusta expend to pursue it.

masonic

BungalowBliss123 said:

L2q7Y9s said:

I have just received an email from HP and it states

Our business model relies on contingent income from winning case and so conversely we are set up to withstand losses. What we cannot do, however, is breach our contractual obligations to our funders, as to do so would expose us to a claim against the firm for frustrating the possibility of Augusta being repaid. It is for that reason that we are compelled to invoice in this scenario, unless or until the funder agrees that we can waive our fee.  

Does this suggest the funder may yet waive the fee ? 

What had you asked them?  Yes, the closing words of their email to you would appear to mean that ‘fees’ might be waived.  They should never have invoiced anyone in the first place - I just don’t understand how they can consider it a ‘win’

It has been explained a few times. The danger of failing to understand is falling into the same trap again.

Knarf01

L2q7Y9s said:

I have just received an email from HP and it states

Our business model relies on contingent income from winning case and so conversely we are set up to withstand losses. What we cannot do, however, is breach our contractual obligations to our funders, as to do so would expose us to a claim against the firm for frustrating the possibility of Augusta being repaid. It is for that reason that we are compelled to invoice in this scenario, unless or until the funder agrees that we can waive our fee.  

Does this suggest the funder may yet waive the fee ? 

I think this email response from HP is important for another reason:

HP’s earlier statements that:

“Augusta and the insurers might wish to pursue payment directly”

look like pressure language, not a description of legal reality.

The internal logic is inconsistent:

• On the one hand, HP say:

  • we must invoice or Augusta might sue us;

• On the other hand, they imply:

  • Augusta might pursue you.

Both cannot be true unless:

• there are two separate contracts (there isn’t evidence of that).

The more credible interpretation is:

• Augusta’s leverage is against HP;

• HP are trying to maximise collections to reduce their own exposure.

This makes a SAR even more important, because:

• It should disclose:

  • the funding agreement (at least in relevant parts),

  • any clauses purporting to pass liability to clients,

  • whether any assignment or third-party rights exist.

If those documents show:

• Augusta’s rights are against HP,

• and clients are not parties,

that is extremely difficult for HP to overcome.

Thanks for sharing 🙏🏻

L2q7Y9s

@BungalowBliss123  -   as suggested by a previous poster on this thread, I asked them to send a full contractual breakdown and evidence of involvement in the FCA outcome.  Plus how/why the fees should apply when the compensation was FCA led.

Their reply, in entirety was as follows 

Thank you for your email. I have attempted to address your questions below.

 What constitutes a win  

  As you know, our agreement with you entitles us to charge you a fee of 35% of any Claim Proceeds you receive, plus VAT. In addition, you have a separate agreement to pay your share of the deferred and contingent insurance premium due to the insurers (to which Harcus Parker is not a party). By our calculations, you ought to have received £***** in compensation, of which £**** is due in fees.

Clause 5.2 of our Damages Based Agreement (“DBA”) with you states that you will 'win' if you recover or are awarded any Claim Proceeds. Clause 5.1 in turn defines 'Claim Proceeds' as 'the sum recovered in respect of the Claim, or any damages awarded to you'. This definition captures any sums received as compensation for losses arising from the Woodford matter.   

In simple terms, this means that you will have ‘won’ if you receive any money (claim proceeds) for your claim, which is defined as follows:  

  (the 'Claim') against Link Fund Solutions Limited, any relevant subsidiary or associated entities, authorised agents, and/or any other entity against whom Harcus Parker advises you to bring a claim (together, the 'Defendants') which arises out of losses suffered by you as a result of the mis-management and suspension of the LF Equity Income Fund (formerly known as the LF Woodford Equity Income Fund) (the 'Fund') in which you hold or held shares or units, either directly or through an intermediary, between 2 June 2014 and at least 3 June 2019.  

   The Scheme of Arrangement and its relationship with the Claim  

   Understandably, you might point out that the Scheme of Arrangement was not something directly instigated by our firm and question why it is we say the funds received from the Scheme can be called Claim Proceeds.   

   The Scheme of Arrangement is a court-approved agreement between investors in the Woodford fund and Link Fund Solutions Limited (“LFSL”). Under the Scheme, investors receive compensation and, in return, agree not to pursue their claims against LFSL or other members of the Link Group, whether proceedings have already been commenced or not. The purpose of the Scheme from Link’s perspective was to close off any liabilities it may have arising from its management of the Woodford Equity Income Fund, expressly including the claims of our clients. It represented to the Court that if the claims were to proceed, along with the FCA fine that had been proposed, it would be rendered insolvent and so it sought the approval of the Companies Court for a settlement which would bind all of its creditors, in this case chiefly the investors in the Woodford Equity Income Fund, whether they agreed to it personally or not. It had to convince the court it was fair to sanction it doing that. We argued it was not fair, chiefly because investors could avail themselves to the Financial Services Compensation Scheme if Link were to become insolvent. The Court rejected that argument on the basis it was not proven that Link would go on to lose the Claims, and so it was fair for investors to decide whether to accept the limited recompense on offer now instead of a potentially greater return later.   

   The Order of the Court, sanctioning the Scheme of Arrangement, included a Release Deed. Clause 3.2 of the Release Deed states that each Scheme creditor   

‘fully, finally, irrevocably and unconditionally releases … any and all claims … arising out of, related to or in connection with the Woodford Equity Income Fund up to and including the Record Date, including any existing or prospective proceedings’.   

   That is typical settlement language.  

   While it was not a significant part of the press reporting, this interpretation of the Scheme, as a settlement of claims, was the common understanding of the parties and the Court. That is reflected in the Court’s judgment sanctioning the Scheme in paragraph 10:  

“[the Scheme] effects a settlement between LFSL and persons who might have civil claims against it … (including, but not limited to, those creditors who have brought Litigation Claims).”   

   The court in paragraph 8 specifically referred to Harcus Parker clients when describing the creditors who brought ‘Litigation claims’.  

   The consequences  

   The obvious injustice of this is that those who have actively advanced a claim and engaged a lawyer to do so receive less than an investor who chose to do nothing. Link itself acknowledged this in the Explanatory Document in which it set out the effect of the Scheme to the creditors, at Part 4 paragraph 19:  

   Where a Scheme Creditor has entered into an arrangement with Leigh Day, Harcus Parker, Wallace LLP or any claims management company with respect to claims they wish to pursue against LFSL, they may need to consider whether there are any fees that may be payable under those arrangements if they receive compensation under the Scheme.  

   The counterbalance against that injustice is that a third-party funder, Augusta, has invested in the claim on behalf of its underlying investors and it is beholden to those investors to recoup any claim proceeds which it is ultimately due. Augusta has spent over £4m on the claim.   

   ‘After the event’ insurance (otherwise referred to as ATE insurance) was also taken out to protect claimants from ‘adverse costs’, in the event we lost the claim. This is because in litigation, the typical rule is that the losing party pays the costs of the winning party, known as ‘adverse costs’. Part of the cost of the ATE insurance was on a deferred and contingent basis which meant that the insurer would be due a fee at the end of the claim if it was successful (successful meaning that our client received compensation and was not ordered to pay Link’s costs).   

   With the funding and insurance in place, this has allowed us to investigate, formulate and advance a claim against Link, including making representations against the Scheme of Arrangement at both the convening and sanctions hearing, while managing the risk of costs in doing so. At these hearings, we instructed a barrister to appear on behalf of our clients and make a case against the implementation of the Scheme of Arrangement on the basis that the Scheme did not represent a good outcome for investors.  

   Because the Claimants have received as little as they have through the Scheme, and because it is unlikely that all of the claimants will pay an invoice, Augusta will not recoup its initial investment or make a profit and the insurer will not receive its full contingent premium. As you would expect, Harcus Parker must pay back Augusta in full before it can retain any of its contingent fee as profit. That is why we have communicated that our firm will make nothing from the case; once the time and expenditure required to seek payment from the clients is factored in, we will have lost money as a result of the Scheme.   

   Our business model relies on contingent income from winning case and so conversely we are set up to withstand losses. What we cannot do, however, is breach our contractual obligations to our funders, as to do so would expose us to a claim against the firm for frustrating the possibility of Augusta being repaid. It is for that reason that we are compelled to invoice in this scenario, unless or until the funder agrees that we can waive our fee.  

   I do hope that answers your question. Please do not hesitate to let me know should you have any further queries.    

   

Knarf01

L2q7Y9s said:

@BungalowBliss123  -   as suggested by a previous poster on this thread, I asked them to send a full contractual breakdown and evidence of involvement in the FCA outcome.  Plus how/why the fees should apply when the compensation was FCA led.

Their reply, in entirety was as follows 

Thank you for your email. I have attempted to address your questions below.

 What constitutes a win  

  As you know, our agreement with you entitles us to charge you a fee of 35% of any Claim Proceeds you receive, plus VAT. In addition, you have a separate agreement to pay your share of the deferred and contingent insurance premium due to the insurers (to which Harcus Parker is not a party). By our calculations, you ought to have received £***** in compensation, of which £**** is due in fees.

Clause 5.2 of our Damages Based Agreement (“DBA”) with you states that you will 'win' if you recover or are awarded any Claim Proceeds. Clause 5.1 in turn defines 'Claim Proceeds' as 'the sum recovered in respect of the Claim, or any damages awarded to you'. This definition captures any sums received as compensation for losses arising from the Woodford matter.   

In simple terms, this means that you will have ‘won’ if you receive any money (claim proceeds) for your claim, which is defined as follows:  

  (the 'Claim') against Link Fund Solutions Limited, any relevant subsidiary or associated entities, authorised agents, and/or any other entity against whom Harcus Parker advises you to bring a claim (together, the 'Defendants') which arises out of losses suffered by you as a result of the mis-management and suspension of the LF Equity Income Fund (formerly known as the LF Woodford Equity Income Fund) (the 'Fund') in which you hold or held shares or units, either directly or through an intermediary, between 2 June 2014 and at least 3 June 2019.  

   The Scheme of Arrangement and its relationship with the Claim  

   Understandably, you might point out that the Scheme of Arrangement was not something directly instigated by our firm and question why it is we say the funds received from the Scheme can be called Claim Proceeds.   

   The Scheme of Arrangement is a court-approved agreement between investors in the Woodford fund and Link Fund Solutions Limited (“LFSL”). Under the Scheme, investors receive compensation and, in return, agree not to pursue their claims against LFSL or other members of the Link Group, whether proceedings have already been commenced or not. The purpose of the Scheme from Link’s perspective was to close off any liabilities it may have arising from its management of the Woodford Equity Income Fund, expressly including the claims of our clients. It represented to the Court that if the claims were to proceed, along with the FCA fine that had been proposed, it would be rendered insolvent and so it sought the approval of the Companies Court for a settlement which would bind all of its creditors, in this case chiefly the investors in the Woodford Equity Income Fund, whether they agreed to it personally or not. It had to convince the court it was fair to sanction it doing that. We argued it was not fair, chiefly because investors could avail themselves to the Financial Services Compensation Scheme if Link were to become insolvent. The Court rejected that argument on the basis it was not proven that Link would go on to lose the Claims, and so it was fair for investors to decide whether to accept the limited recompense on offer now instead of a potentially greater return later.   

   The Order of the Court, sanctioning the Scheme of Arrangement, included a Release Deed. Clause 3.2 of the Release Deed states that each Scheme creditor   

‘fully, finally, irrevocably and unconditionally releases … any and all claims … arising out of, related to or in connection with the Woodford Equity Income Fund up to and including the Record Date, including any existing or prospective proceedings’.   

   That is typical settlement language.  

   While it was not a significant part of the press reporting, this interpretation of the Scheme, as a settlement of claims, was the common understanding of the parties and the Court. That is reflected in the Court’s judgment sanctioning the Scheme in paragraph 10:  

“[the Scheme] effects a settlement between LFSL and persons who might have civil claims against it … (including, but not limited to, those creditors who have brought Litigation Claims).”   

   The court in paragraph 8 specifically referred to Harcus Parker clients when describing the creditors who brought ‘Litigation claims’.  

   The consequences  

   The obvious injustice of this is that those who have actively advanced a claim and engaged a lawyer to do so receive less than an investor who chose to do nothing. Link itself acknowledged this in the Explanatory Document in which it set out the effect of the Scheme to the creditors, at Part 4 paragraph 19:  

   Where a Scheme Creditor has entered into an arrangement with Leigh Day, Harcus Parker, Wallace LLP or any claims management company with respect to claims they wish to pursue against LFSL, they may need to consider whether there are any fees that may be payable under those arrangements if they receive compensation under the Scheme.  

   The counterbalance against that injustice is that a third-party funder, Augusta, has invested in the claim on behalf of its underlying investors and it is beholden to those investors to recoup any claim proceeds which it is ultimately due. Augusta has spent over £4m on the claim.   

   ‘After the event’ insurance (otherwise referred to as ATE insurance) was also taken out to protect claimants from ‘adverse costs’, in the event we lost the claim. This is because in litigation, the typical rule is that the losing party pays the costs of the winning party, known as ‘adverse costs’. Part of the cost of the ATE insurance was on a deferred and contingent basis which meant that the insurer would be due a fee at the end of the claim if it was successful (successful meaning that our client received compensation and was not ordered to pay Link’s costs).   

   With the funding and insurance in place, this has allowed us to investigate, formulate and advance a claim against Link, including making representations against the Scheme of Arrangement at both the convening and sanctions hearing, while managing the risk of costs in doing so. At these hearings, we instructed a barrister to appear on behalf of our clients and make a case against the implementation of the Scheme of Arrangement on the basis that the Scheme did not represent a good outcome for investors.  

   Because the Claimants have received as little as they have through the Scheme, and because it is unlikely that all of the claimants will pay an invoice, Augusta will not recoup its initial investment or make a profit and the insurer will not receive its full contingent premium. As you would expect, Harcus Parker must pay back Augusta in full before it can retain any of its contingent fee as profit. That is why we have communicated that our firm will make nothing from the case; once the time and expenditure required to seek payment from the clients is factored in, we will have lost money as a result of the Scheme.   

   Our business model relies on contingent income from winning case and so conversely we are set up to withstand losses. What we cannot do, however, is breach our contractual obligations to our funders, as to do so would expose us to a claim against the firm for frustrating the possibility of Augusta being repaid. It is for that reason that we are compelled to invoice in this scenario, unless or until the funder agrees that we can waive our fee.  

   I do hope that answers your question. Please do not hesitate to let me know should you have any further queries.    

   

Thanks for sharing this (lengthy) email reply.

It appears that

• HP are bundling ATE cost into a “DBA invoice”

• They have not shown:

  • the ATE policy,

  • your acceptance of liability,

  • how your share is calculated

• They rely heavily on:

  • business-model explanations,

  • fairness arguments,

  • funder logic

Those are not substitutes for a clear contractual obligation.

• While the DBA refers to insurance premiums as “Disbursements”,

• no enforceable liability can arise without:

  • a compliant DBA,

  • transparency as required by regulation,

  • disclosure of the policy and calculation,

  • and proof that liability has crystallised in your specific case. 

    Again a SAR is helpful here as this should capture:

    • the ATE policy itself,

    • the premium amount,

    • whether it was deferred or contingent,

    • whether the premium was ever actually paid,

    • any allocation methodology,

    • communications with Augusta and insurers about recovery.

    Until HP discloses those materials:

    • they are asserting liability without evidence, and

    • you are entitled to withhold engagement on payment.

    
    

SmellyWellies

Knarf01 said:

L2q7Y9s said:

@BungalowBliss123  -   as suggested by a previous poster on this thread, I asked them to send a full contractual breakdown and evidence of involvement in the FCA outcome.  Plus how/why the fees should apply when the compensation was FCA led.

Their reply, in entirety was as follows 

Thank you for your email. I have attempted to address your questions below.

 What constitutes a win  

  As you know, our agreement with you entitles us to charge you a fee of 35% of any Claim Proceeds you receive, plus VAT. In addition, you have a separate agreement to pay your share of the deferred and contingent insurance premium due to the insurers (to which Harcus Parker is not a party). By our calculations, you ought to have received £***** in compensation, of which £**** is due in fees.

Clause 5.2 of our Damages Based Agreement (“DBA”) with you states that you will 'win' if you recover or are awarded any Claim Proceeds. Clause 5.1 in turn defines 'Claim Proceeds' as 'the sum recovered in respect of the Claim, or any damages awarded to you'. This definition captures any sums received as compensation for losses arising from the Woodford matter.   

In simple terms, this means that you will have ‘won’ if you receive any money (claim proceeds) for your claim, which is defined as follows:  

  (the 'Claim') against Link Fund Solutions Limited, any relevant subsidiary or associated entities, authorised agents, and/or any other entity against whom Harcus Parker advises you to bring a claim (together, the 'Defendants') which arises out of losses suffered by you as a result of the mis-management and suspension of the LF Equity Income Fund (formerly known as the LF Woodford Equity Income Fund) (the 'Fund') in which you hold or held shares or units, either directly or through an intermediary, between 2 June 2014 and at least 3 June 2019.  

   The Scheme of Arrangement and its relationship with the Claim  

   Understandably, you might point out that the Scheme of Arrangement was not something directly instigated by our firm and question why it is we say the funds received from the Scheme can be called Claim Proceeds.   

   The Scheme of Arrangement is a court-approved agreement between investors in the Woodford fund and Link Fund Solutions Limited (“LFSL”). Under the Scheme, investors receive compensation and, in return, agree not to pursue their claims against LFSL or other members of the Link Group, whether proceedings have already been commenced or not. The purpose of the Scheme from Link’s perspective was to close off any liabilities it may have arising from its management of the Woodford Equity Income Fund, expressly including the claims of our clients. It represented to the Court that if the claims were to proceed, along with the FCA fine that had been proposed, it would be rendered insolvent and so it sought the approval of the Companies Court for a settlement which would bind all of its creditors, in this case chiefly the investors in the Woodford Equity Income Fund, whether they agreed to it personally or not. It had to convince the court it was fair to sanction it doing that. We argued it was not fair, chiefly because investors could avail themselves to the Financial Services Compensation Scheme if Link were to become insolvent. The Court rejected that argument on the basis it was not proven that Link would go on to lose the Claims, and so it was fair for investors to decide whether to accept the limited recompense on offer now instead of a potentially greater return later.   

   The Order of the Court, sanctioning the Scheme of Arrangement, included a Release Deed. Clause 3.2 of the Release Deed states that each Scheme creditor   

‘fully, finally, irrevocably and unconditionally releases … any and all claims … arising out of, related to or in connection with the Woodford Equity Income Fund up to and including the Record Date, including any existing or prospective proceedings’.   

   That is typical settlement language.  

   While it was not a significant part of the press reporting, this interpretation of the Scheme, as a settlement of claims, was the common understanding of the parties and the Court. That is reflected in the Court’s judgment sanctioning the Scheme in paragraph 10:  

“[the Scheme] effects a settlement between LFSL and persons who might have civil claims against it … (including, but not limited to, those creditors who have brought Litigation Claims).”   

   The court in paragraph 8 specifically referred to Harcus Parker clients when describing the creditors who brought ‘Litigation claims’.  

   The consequences  

   The obvious injustice of this is that those who have actively advanced a claim and engaged a lawyer to do so receive less than an investor who chose to do nothing. Link itself acknowledged this in the Explanatory Document in which it set out the effect of the Scheme to the creditors, at Part 4 paragraph 19:  

   Where a Scheme Creditor has entered into an arrangement with Leigh Day, Harcus Parker, Wallace LLP or any claims management company with respect to claims they wish to pursue against LFSL, they may need to consider whether there are any fees that may be payable under those arrangements if they receive compensation under the Scheme.  

   The counterbalance against that injustice is that a third-party funder, Augusta, has invested in the claim on behalf of its underlying investors and it is beholden to those investors to recoup any claim proceeds which it is ultimately due. Augusta has spent over £4m on the claim.   

   ‘After the event’ insurance (otherwise referred to as ATE insurance) was also taken out to protect claimants from ‘adverse costs’, in the event we lost the claim. This is because in litigation, the typical rule is that the losing party pays the costs of the winning party, known as ‘adverse costs’. Part of the cost of the ATE insurance was on a deferred and contingent basis which meant that the insurer would be due a fee at the end of the claim if it was successful (successful meaning that our client received compensation and was not ordered to pay Link’s costs).   

   With the funding and insurance in place, this has allowed us to investigate, formulate and advance a claim against Link, including making representations against the Scheme of Arrangement at both the convening and sanctions hearing, while managing the risk of costs in doing so. At these hearings, we instructed a barrister to appear on behalf of our clients and make a case against the implementation of the Scheme of Arrangement on the basis that the Scheme did not represent a good outcome for investors.  

   Because the Claimants have received as little as they have through the Scheme, and because it is unlikely that all of the claimants will pay an invoice, Augusta will not recoup its initial investment or make a profit and the insurer will not receive its full contingent premium. As you would expect, Harcus Parker must pay back Augusta in full before it can retain any of its contingent fee as profit. That is why we have communicated that our firm will make nothing from the case; once the time and expenditure required to seek payment from the clients is factored in, we will have lost money as a result of the Scheme.   

   Our business model relies on contingent income from winning case and so conversely we are set up to withstand losses. What we cannot do, however, is breach our contractual obligations to our funders, as to do so would expose us to a claim against the firm for frustrating the possibility of Augusta being repaid. It is for that reason that we are compelled to invoice in this scenario, unless or until the funder agrees that we can waive our fee.  

   I do hope that answers your question. Please do not hesitate to let me know should you have any further queries.    

   

Thanks for sharing this (lengthy) email reply.

It appears that

• HP are bundling ATE cost into a “DBA invoice”

• They have not shown:

  • the ATE policy,

  • your acceptance of liability,

  • how your share is calculated

• They rely heavily on:

  • business-model explanations,

  • fairness arguments,

  • funder logic

Those are not substitutes for a clear contractual obligation.

• While the DBA refers to insurance premiums as “Disbursements”,

• no enforceable liability can arise without:

  • a compliant DBA,

  • transparency as required by regulation,

  • disclosure of the policy and calculation,

  • and proof that liability has crystallised in your specific case. 

    Again a SAR is helpful here as this should capture:

    • the ATE policy itself,

    • the premium amount,

    • whether it was deferred or contingent,

    • whether the premium was ever actually paid,

    • any allocation methodology,

    • communications with Augusta and insurers about recovery.

    Until HP discloses those materials:

    • they are asserting liability without evidence, and

    • you are entitled to withhold engagement on payment.

    
    

Further to the above, someone dealing with this shared a copy of the DBA, which is itself contained within a 24 page document (I'm not sure how the average leyman is supposed to be able to understand all of this). I've extracted what I think are the relevant parts and attached below.

Whereas there is detail of how their fees are calculated, I haven't been able to find any such detail around the insurance element further to 7.1 iii)

It appears the fees they're after relate to the money sent out at the end of Q1 2024, which was about 5p per share apparently. 

I'm not clear on how to construct an SAR to help to get to the next layer of information.

Apologies, the formatting has not been easy to copy across.

5          What happens if you win?
5.1       'Claim Proceeds' means the sum recovered in respect of the Claim, or any damages awarded to you (but not including any costs, barristers' fees or disbursements paid or payable by another party to the Claims within clause
5.5 below).
5.2       You will 'Win' if you recover or are
awarded any Claim Proceeds.
5.3       If you Win, you will pay:
i)           an amount of money equivalent to 35% plus VAT of the Claim
Proceeds to Harcus Parker (the
'Solicitors' Fee'); and
ii)          the Disbursements (as defined in clause 7, below)
5.4       The Solicitors' Fee is calculated before the payment by you of tax (if any) on the amount recovered or awarded.
 
5.5       The Solicitors' Fee payable by you shall
in all circumstances be net of:
i)           any costs (including fixed costs under Part 45 of the Civil Procedure Rules 1998 'CPR'); and
ii)          any sum in respect of barristers'
fees incurred by Harcus Parker,
that have been paid or are payable by another party to the proceedings by agreement or order.
 
7           Disbursements
7.1       'Disbursements' means your proportionate share (calculated in the way set out in the LMA) of the expenses which Harcus Parker will need to pay in order to bring the proceedings (but does not include barristers' fees which are included in the Solicitors' Fee). These include:
i)           the fees of experts;
ii)          Court fees (where applicable);
iii)         the payment of insurance premiums (if relevant, and whether or not such premiums are payable up front or deferred and/or payable only in the event of success);
iv)         the costs, as applicable, of data rooms, disclosure platforms, and electronic bundling systems;
v)          couriers and other document production costs such as photocopying charges