11 July 2012 Last updated at 05:15 ET

'Confusion' over no win, no fee legal products

Complaints seen by the ombudsman include fees levied despite cases never reaching court

Consumers are struggling to understand complex and confusing products sold by the legal sector, an ombudsman has warned.

Complaints to Legal Ombudsman Adam Sampson included unrealistic no win, no fee promises, and confusing legal insurance policies.

He encouraged people to be vigilant over the products being sold to them.

The ombudsman has the power to independently resolve legal complaints against lawyers.

Reputation protection

Writing in the service's annual report, Mr Sampson said that the legal sector needed to ensure it did not follow the financial services industry in damaging itself in the eyes of consumers.

The mis-selling of payment protection insurance (PPI) had hit the reputation of financial services providers and the legal sector must not follow suit, he said.

Cases that the ombudsman had seen included the story of Eileen Dunn, from Leicester, who was told to pay a firm £15,000 for a personal injury case that never made it to court, despite instructing them on a supposed "no win, no fee" basis.

The ombudsman ordered the firm to waive its charges.

A survey for the ombudsman suggested that most people were unaware which legal services were excluded by a legal expenses insurance policy.

"The arrival of new commercial products is generally to be celebrated as it makes legal services more affordable for most of us," Mr Sampson said.

"But consumers have a responsibility too to protect themselves and apply the due diligence when sourcing legal products. Check the small print, shop around and make sure you know exactly what you are buying."