Woodford compensation and No Win No Fee fees

aroominyork

After learning a lesson about how fund managers can go rogue, you are now learning a more useful, though difficult, lesson about why law firms are in business. For the vast majority it is not in a quest for justice, it is as a business. When they said no cost or payment would be required unless and until the case is successful, you can be sure that the settlement that was reached – whether or not you liked it – will count as a settlement. These are ambulance chasing/class action lawyers and they know what they were doing; you would not have received any compensation unless the lawyers acting on your behalf knew it would tick the box for them to legally claim their fee from you.

masonic

The majority of legal claims end in settlement, and it's actively encouraged by the courts as a means of easing pressure upon them. If you've ended up with something that wasn't on the table when you signed up to the claim, then it is likely your agreement entitles the firm running the claim to a share of this. Even if it cannot be demonstrated that the settlement came about through the hard work of your lawyers.

dunstonh

jimjames said:

I thought I'd have a check on this to see if I'd had any emails from these people. I didn't find anything in my mailbox but did find this gem in an email in June 2017 from HL. In hindsight they weren't hiding the small companies element but certainly underplaying the significance.

Neil Woodford is one of the most successful and well-known fund managers in the UK, with a career spanning over 30 years. His flagship CF Woodford Equity Income Fund has just reached its third anniversary. In my in-depth report I take a look at how it has fared and explain why we believe it remains an excellent choice for investors seeking income, growth or a combination of the two. In the report I explain how the fund differs from many of its peers, with Neil Woodford using exposure to higher-risk smaller companies to boost its growth potential.

Interestingly, here is a snippet from a research report provided to IFAs from one of the larger research companies IFAs use in their September 2017 due diligence report.     They would review many funds and assign a buy/sell/hold rating to each.  IFAs were free to use the info as they wanted, and it covered hundreds of funds.

saajan_12

masonic said:

The majority of legal claims end in settlement, and it's actively encouraged by the courts as a means of easing pressure upon them. If you've ended up with something that wasn't on the table when you signed up to the claim, then it is likely your agreement entitles the firm running the claim to a share of this. Even if it cannot be demonstrated that the settlement came about through the hard work of your lawyers.

Indeed, put differently the settlement offer only came because they knew the very real threat of a court claim (plus resulting costs) if they didn't settle. That threat is made by the lawyers who set out the case. 

The issue with NWNF deals is it says nothing about how reasonable the fee is if you do win. Even a 99% contingent fee is technically covered by NWNF, but is obviously a bad deal for the claimant who goes through the stress for only 1% best case. Solving for the worst case (no loss) is not always advisable, you have to consider all cases eg what if you win. 

brewerdave

Looks like Harcus Parker are trying to ratchet up the pressure. First email with the invoice on Thurday 18th, second email saying they had noticed I hadn't paid ,received this morning - just TWO working days later !!

MapsterUK

Inbrewerdave said:

Looks like Harcus Parker are trying to ratchet up the pressure. First email with the invoice on Thurday 18th, second email saying they had noticed I hadn't paid ,received this morning - just TWO working days later !!

Hmm I received an email earlier in the year and then one about a week ago. The tone of each email was the same. According to their comment to the Times they were NOT going to chase people who didn’t pay. 

BungalowBliss123

What is Harcus Parker’s invoice based on / how is it calculated?  Does it relate to a percentage of the compensation you have been paid?

MapsterUK

The fee is 35% plus vat. Also the cost of the insurance (not mentioned in the FAQ on their website) £1.75 million is divided out to claimants and a 12% insurance tax.

This takes you to over half of the compensation that they failed to win back and if you take it from your pension where compensation was deposited then it could wipe the total amount out or more!

BungalowBliss123

Thank you.  It’s a disgrace in my opinion what’s happened, from the Woodford fund to now this, and people could potentially be out of pocket even more than they already were.  What if no compensation has been paid?  What is the invoice based on?

MapsterUK

The invoice is based on their guesstimate of what we would have received from Link. We have actually been asked to do the math to calculate what we owe them. They have provided a link for us to give further information. 

Their cheek is staggering.