Our personal injury law firm gets calls from clients who ask us what a “contingency fee” means. Contingency means recovery. The best thing about contingency fee agreements for a potential client is that the client doesn’t put up any out-of-pocket money. There are no hourly attorney fees. The only fee is the percentage of the recovery agreed to in the contingency fee agreement.
So what happens if we don’t make a recovery? Well, there is no legal fee for the client.
If you’ve been injured due to someone else’s negligence, our law firm can help you get financial compensation for all your losses. At Shapiro, Washburn & Sharp, we can help you assess your claim and guide you through the legal process to ensure you receive the compensation you deserve. Call us today at 833-997-1774 for a free consultation.
What Is a Contingency Fee in a Personal Injury Case?
A contingency fee is a payment structure used by personal injury lawyers in which the attorney’s fee is contingent upon the successful outcome of the case. Instead of charging hourly rates or flat fees, the lawyer agrees to take a percentage of the final settlement or court award if the case is won. If the case is lost, the client does not owe any legal fees. This structure helps ensure that individuals with limited financial resources can still pursue legal action without upfront costs.
How Does a Contingency Fee Work?
In a personal injury case, the lawyer and client agree that the lawyer will represent the client in exchange for a percentage of any compensation the client receives, whether through a settlement or court judgment. If the client loses the case, the lawyer receives nothing, which is why the lawyer will assess the merits of the case before taking it on. If the case is won or settled favorably, the lawyer’s fee is calculated as a percentage of the total amount awarded to the client. The specific percentage is usually outlined in a written agreement.
For example, if a client receives a $100,000 settlement and the agreed-upon contingency fee is 30 percent, the lawyer would receive $30,000. It’s important to note that other expenses, such as court fees, expert witness fees, and investigative costs, may be separate and could be deducted from the settlement amount before the lawyer’s fee is calculated.
Why Do Lawyers Charge Contingency Fees for Personal Injury Cases?
Lawyers charge contingency fees because they align their compensation with the success of the case. This arrangement benefits both the client and the attorney. For clients, it reduces the financial burden of paying legal fees upfront, which can be especially helpful for those recovering from injuries who might not be able to afford hourly lawyer rates.
This fee arrangement provides an incentive for lawyers to work hard on the case to achieve the best possible outcome, as their payment is directly tied to the result. It also allows lawyers to represent clients who may not otherwise have access to legal counsel due to financial constraints.
Are There Other Costs Involved in a Personal Injury Case with a Contingency Fee?
Yes, even though a contingency fee agreement means you don’t pay for the lawyer’s time unless the case is successful, there may still be additional costs associated with pursuing a personal injury case. These costs, known as “case expenses,” can include court filing fees, fees for obtaining medical records, expert witness fees, and other administrative costs required to build your case.
These expenses are typically separate from the lawyer’s contingency fee. In some cases, your attorney may agree to cover these costs upfront, with the understanding that they will be reimbursed out of your settlement or court award. However, if the case is unsuccessful, the client may still be responsible for these costs. It’s important to clarify with your attorney what costs you may be responsible for in addition to the contingency fee.
What Happens If I Lose My Personal Injury Case Under a Contingency Fee Agreement?
If your personal injury case is unsuccessful and you lose, you generally do not have to pay the lawyer’s contingency fee. This is one of the primary benefits of this fee structure. However, as mentioned earlier, you may still be responsible for any case expenses that were incurred during the legal process, such as court fees or costs for gathering evidence.
It’s important to discuss these possible expenses with your attorney beforehand so that you are fully aware of any financial obligations you may face, even if the case doesn’t result in a settlement or award. Some lawyers may also offer to cover certain costs upfront, but this is something to clarify during your initial consultation.
What Should I Do If I’ve Been Injured in an Accident?
If you’ve been injured due to someone else’s negligence, the first step is to seek medical treatment. Once your immediate needs are addressed, contact an attorney who specializes in personal injury cases to discuss your options.
At Shapiro, Washburn & Sharp, we have decades of experience handling personal injury claims. We understand how to navigate the legal process and work with you to maximize the value of your case. Call us at 833-997-1774 to schedule a free consultation and let us help you get the compensation you deserve.