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Statutory charge and contributions

This content applies to England & Wales

When and how clients might have to repay the cost of legal aid.

Clients in receipt of legal representation (but not legal help) where legal aid has been awarded may have to pay a contribution towards the cost, depending on their level of disposable income and capital. If they are wholly or partially successful in legally aided proceedings, they may also have to pay the 'statutory charge'.

Contributions

The Legal Advice Agency (LAA) will assess whether clients have to make payments towards their legal aid. This decision is based on the information regarding the levels of disposable income and capital provided on the clients' application forms. The LAA will write to clients settling out how much the contributions are and how to pay them. Clients must keep the LAA updated with any changes to their financial circumstances throughout the course of the matter. Not everyone will have to pay contributions.

There are two types of contribution:

  • lump sum contributions from capital (including savings)
  • monthly contributions from income.

Legal Aid Agency eligibility key cards

The annually updated (in April) Legal Aid Agency eligibility key card provides information about applicable capital and income limits, a step-by-step guide on how to carry out a financial eligibility assessment and an indication of the contributions payable by clients.

The statutory charge

Clients will have to repay some or all of the cost of their case by way of statutory charge if they:

  • receive legal representation, and
  • are wholly or partly successful in the proceedings, or obtain an out-of-court settlement with the benefit of legal aid, and
  • keep or gain property or money.

Any damages awarded to the client as the result of legal action funded by legal aid are paid to the client's lawyer, not to the client.

The statutory charge is a claw-back mechanism used by the LAA to recover what it has spent on a case. The statutory charge is particularly relevant to mortgage possession proceedings, proceedings resulting from a relationship breakdown, and proceedings relating to the beneficial interest in a property, where a client obtains or retains the possession of her/his home. Regulations set out details of how it is calculated and how it operates.[1]

Payment

Any money or assets a client gains or keeps must be used first to pay the statutory charge. The client keeps the balance remaining. Payment to the LAA is made through the client's solicitor.

Normally the statutory charge is to be paid straight away. However, if a client retains her/his home the LAA may agree to postpone the repayment and will register a charge on the property as a security. Once the statutory charge is registered against a property, it will not be possible to sell it or borrow more money against it without first repaying the LAA. Interest will accrue on the charge until it is paid.

Unless a client has been assessed by the LAA as liable to pay a monthly contribution (see above), s/he will have to pay nothing towards the cost of the case whilst it is continuing.

Information for clients

A solicitor or legal adviser providing legal aid services where either a contribution or the statutory charge apply, or who is referring a client to another provider, must tell the client about the possibility s/he may have to pay the LAA back for the services received.

For more information on charges, see the Legal Aid Agency 's Paying for your civil legal aid.

[1] The Civil Legal Aid (Statutory Charge) Regulations 2013 SI 2013/503.

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