28 June 2019 – By Zelda Venter on iol.co.za
Pretoria – No win, no fee – the so-called contingency fee arrangement between lawyers and the cash-strapped public who wish to institute a claim following an injury or other harm – is often a contentious issue, but this subject saw leading Pretoria lawyer Gert Nel scooping a prestigious legal award.
Nel, of the law firm Gert Nel Inc, won the 2018 LexisNexis prize for the best article by a practising attorney published in De Rebus, the official journal of the attorney’s profession.
This was his first ever article submitted to De Rebus and the first prize he has ever won.
“The main aim of the article was to somehow contribute in addressing the long debated issue of what would be regarded as an acceptable or reasonable interpretation and application of the Contingency Fees Act,” Nel said.
Lawyers are often asked by their clients to enter into contingency fee arrangements as they cannot afford the legal fees to pay them upfront. Should the client win the case, the legal fees payable may in terms of the agreement can be recovered from the financial award of the client.
This fee is usually more than the usual fee, as the attorneys face the risk of losing a case, yet they have to incur all the costs leading up to the finalisation of a case.
“The correct interpretation of Section 2(1)(a) and (b) of the Contingency Fee Act has always been a contentious issue. With limited meaningful guidelines on the topic, any attorney engaging a client on this fee basis exposes themselves to tremendous risk from a professional and financial point of view. This is especially so if his or her own interpretation does not find favour with their professional controlling body or the courts.”
In his comprehensive article, Nel set out the origins of contingency fees, foreign law in this regard as well as how both the public and attorneys should be safeguarded.
He wrote that clients should be protected against potential abuses, but he posed the question – and provided the answer – as to what a reasonable fee should be.
Nel said the South African Law Commission investigated the issue in 1996 and recommended that contingency fee agreements should be legalised in the country.
“A lot of research went into the preparation of the article, and I consulted many sources. I gave practical examples to substantiate the comments I made and to act as a practical guideline to practitioners who want to engage in contingency fee agreements,” said Nel.
Nel, who is part of the campaign against the proposed new Road Accident Benefit Scheme Bill (RABS), said during his presentations to Parliament on this topic, it became apparent to him that the uncertainty and concerns over the application of contingency fees on RAF matters was one of the motivations forwarded by the Transport Department for excluding attorneys from the RABS dispensation.
Nel said legal certainty over the application of contingency fees was necessary to address all the concerns raised in this regard.