Deciphering Contingency Fees: What You Need to Know

Deciphering Contingency Fees: What You Need to Know

Most victims do not opt for a lawyer, thinking they will have to pay a lot of fees to the lawyer. However, that is not the case when it comes to personal injury lawyers. Most of them charge contingency fees rather than hourly or total fees. Before you narrow down your list and select an Enterprise personal injury lawyer, it is important to understand how the contingency fee structure works to stay on the safer side and avoid misunderstandings. 

What is the Contingency fee?

Contingency refers to the lawyer charging a percentage of the total compensation the client recovers from the claim.  Upon the agreement, the client gets the exact percentage the lawyer will be charging for their claim. Generally, lawyers charge 33% for the claims, but it might go up to 40% if the case goes to court. Note that the percentage charged differs from one lawyer to another. 

In most cases, the contingency fee structure falls in favor of the client. This is because the client (victim) may not be able to pay the lawyer’s fee if there is a fixed fee attached. 

In addition, the client does not pay from their own pockets. If you take a closer look, the lawyers get a portion of your compensation, so this is usually good for the clients since they pay from the money they receive. Make sure the agreement is in writing whenever you are proceeding with a lawyer. 

What if the client does not receive any compensation?

If there is no settlement or compensation received and the lawyer did not pay any fee, the client may not need to pay them anything. However, it is vital to note here that each lawyer works differently, and you might have to pay the lawyer if it is written in the agreement. 

This is why it is advisable to thoroughly go through the agreement and discuss the details when the client does not receive the settlement, what would be the fee structure? 

In case the lawyer has paid fees for various legalities ahead on behalf of the client, they will have to pay that fee back. Similarly, lawyers can charge their hourly rates even if the client does not recover any compensation. 

In case of termination of the contingency fee, the client can decide whenever they want to. But remember, when signing the agreement, the clause of payment in a situation where the client does not get compensation must be included. If it is absent, you might want to talk to the lawyer to include it.