What Does “Contingency Fee” Mean?
The Centers for Disease Control and Prevention report that approximately 3 million people suffer non-fatal injuries resulting from motor vehicle accidents every year. If a negligent driver injured you or someone you love, an experienced personal injury attorney can help you recover damages related to your accident.
But what if you can’t afford an attorney? Sadly, every day, victims go without the compensation they need because they believe an attorney will cost too much. This should never happen. Many personal injury attorneys work on a contingency fee basis. To learn more about your right to seek compensation, contact an experienced personal injury attorney.
What Is a Contingency Fee?
The law defines a contingency fee as a fee for legal services that is “contingent upon the outcome of the matter for which the services were obtained.” In practice, this means you only have to pay attorney’s fees if you receive a positive outcome in your case. Typically, the contingency fee is a certain percentage of the final settlement or verdict. Contingency fees can vary from place to place and you may negotiate your fees with your attorney. Before your attorney begins to work on your case, they will typically have you sign a contingency fee agreement.
While the state does not limit contingency fees, state legal ethics require attorneys to refrain from charging unconscionable or unreasonable fees. Cases that go to trial require more work and preparation than those that settle out of court. For this reason, your attorney may charge a higher percentage fee if your case goes to trial. An attorney cannot arbitrarily change a contingency fee agreement after both parties sign the agreement. As such, if there is a higher fee for taking the case to court or the fee is otherwise variable, the contingency fee agreement will outline these costs.
Does My Contingency Fee Cover All Costs?
Contingency fees typically cover all billed hours for any attorney or law firm staff member who works on your case. Most contingency fee agreements separate attorney fees from other costs. Costs may include any expenses your attorney has to pay for out of pocket to prepare, negotiate, or litigate your case. These costs are on top of the attorney’s fees. Your contingency fee agreement should outline whether these costs come out before or after the contingency fee computation.
Common costs in a personal injury case include:
- Filing fees;
- Service fees;
- Travel costs; and
- Expert witness costs.
Your attorney should keep a running record of all costs throughout your case. If you are worried about costs and would like to see a current statement, contact your attorney.
What Happens if I Don’t Win My Case?
Attorneys who work on a contingency basis often lose money if their client doesn’t win. This means most attorneys won’t take a case unless they anticipate a positive outcome. That said, in rare instances, despite their best efforts, an attorney cannot settle or win the case. If this happens, you will not have to pay any attorney’s fees. However, you may still be responsible for any outstanding costs, depending on the terms of your contingency fee agreement.
How Does My Lawyer Get Paid?
If you have ever worked with an attorney before, you are likely familiar with retainers. A retainer is an initial down payment towards the attorney’s bill. The good news is that attorneys who work under a contingency fee agreement do not typically require a retainer. In fact, most do not even require a fee for the initial consultation. This means you generally do not need to come up with any initial costs out of pocket.
During your case, your attorney may cover costs that come up or they may give you the option to pay these costs as you go. Once you reach an agreement with the other party, the other insurance company will issue a payment to your attorney. Your attorney will then set aside their portion and pay any outstanding case costs. At this time, they will also usually settle any remaining medical debt. Once your attorney completes a final reconciliation of your case, they will issue you a check for the remaining balance.
How to Choose the Right Personal Injury Attorney for You
Dealing with a serious injury is never easy. That’s why it’s important to surround yourself with people you trust. One of the most important things you can do is choose an experienced personal injury attorney who can help you fight for your rights. There are many factors you should consider before you hire a personal injury attorney.
- Location: It is typically easier to work with someone close to you. This will make it easier to set up in-person meetings and if you have to go to court.
- Experience: While any attorney can negotiate a personal injury case, you will usually get the best results with an attorney who works exclusively on personal injury matters. An experienced personal injury attorney understands the tactics insurance companies use to reduce payments and may have previous experience negotiating with the insurance company in your case.
- Comfort: Your personal injury attorney will know a lot about you and your injuries by the end of your case. Openly and honestly discuss everything related to your accident. Because of this, you need to feel comfortable with your attorney. If you don’t think an attorney is the right fit, it’s okay to move on.
Contingency Fees Help You Get the Help You Need
Money should never stop you from getting the help you need after an accident. If you or a loved one has suffered an injury as the result of someone else’s negligence, you may be entitled to financial compensation. To learn more about your rights, contact an experienced personal injury attorney today.