If you are thinking about filing a personal injury lawsuit, then you may have questions about contingency fees. Most personal injury lawyers charge their clients contingency fees. For most lawsuits, personal injury lawyers charge fees of 33% or 1/3 of the final settlement amount in the case. However, not all lawyers charge the same amount. There can be many different contingency fee structures. The bar association rules require lawyers to charge reasonable contingency fees.
Lawyers Can Charge Different Contingency Fee Percentages
The most common contingency fee among lawyers is 33%. However, fees can be different depending on the type of case and laws that may limit attorney fees. For example, the law in most states limits the amount of contingency fees a lawyer can charge related to workers’ compensation claims. Moreover, lawyers may charge higher contingency fees based on certain factors, including:
- The case is difficult or complex
- The lawyer will need to advance substantial litigation costs
- Trial will be required
- The experience and success of the lawyer being hired
Contingency Benefit Clients
Contingency fees minimize the client’s financial risk in hiring an attorney to represent them. And clients often don’t have the money to pay the lawyer the fees and costs necessary to litigate. Likewise, lawyers sometimes charge a higher percentage contingency fee based upon the amount of risk they are taking in committing their time and money to the cause.
How a Personal Injury Fee Structure Usually Works
Most personal injury law firms follow the same fee structure. They collect a percentage-based fee at the end of the case. Although this remains standard industry practice, contingency fees can increase based upon the work and money the lawyer expects to invest in the case. In contrast, lawyers usually charge hourly fees in other client matters. For example, criminal defense lawyers usually charge a retainer which is an amount of money paid up front that the lawyer draws down to pay themselves for their hourly work.
Pay Lawyer Fees Only if You Win
A contingency fee structure simply means you pay a lawyer only if they win. Contingency fees depend on the attorney winning a settlement or court award for you. Also, the lawyer pays the litigation costs for you and gets paid back if they win. Therefore, you pay the lawyer nothing up front.
Contingency Fees Depend on Amount Recovered
Additionally, the amount of the contingency fee earned by the lawyer depends on the total amount of the final award or settlement. For example, if the lawyer recovers $1,000,000 for the client in settlement, the attorney charging a 1/3 contingency fee will receive $333,333.
If you hire a personal injury lawyer, it is important to discuss the contingency fee arrangement with the lawyer to make sure that you understand the details of the legal fee contract.
