A contingency fee agreement is a contract with a law firm to represent you in a personal injury case for a fee that is based upon how much you receive in compensation for your injuries. If you receive no compensation, then there is no fee for the legal services provided. If you do receive compensation, then the fee is a percentage of that compensation.
CONTINGENCY FEES IN PERSONAL INJURY CASES
Much legal work is paid on an hourly basis – fees are charged at a set billing rate for the amount of time spent. It is also common for law firms to require a retainer – a lump sum of money paid when the law firm is first hired, to be applied against the time spent on the legal work. But this fee structure usually does not work for personal injury cases. People who are injured usually can’t afford to pay a lawyer upfront to take their case, especially when they have suffered serious injuries that require expensive medical care and are preventing them from earning a living. There is also no guarantee of any outcome in a personal injury case, and most people can’t afford to pay for a lawyer’s time if the case is not successful. It is for this reason that a contingency fee has been called “the key to the courthouse,” because, without it, injured clients could not afford to bring personal injury claims seeking recovery for their injuries. The contingency fee is paid only at the end of the case, and is only charged if there has been a recovery in the case.
COSTS OF BRINING A PERSONAL INJURY CASE
There are costs associated with the bringing of a personal injury case. Examples of such costs may include:
- Filing fees
- Service of process fees
- Expenses to obtain copies of medical records
- Deposition expenses, including court reporters’ fees
- Investigation fees
- Expert fees
- Jury fees
- Court appearance fees
- Exhibit expenses and many others.
These costs remain the obligation of the client no matter what the outcome of the case under a contingency fee agreement. These costs do not include any lawyer or staff time. These costs are generally paid out of the successful recovery.
Under the Rules of Professional Conduct – ethical rules that apply to every attorney – attorney fees must be reasonable. This is also true of contingency fees. As such, any fee structure may be reviewed by the court as to its reasonableness at the end of the personal injury case.