(Newswire.net — October 5, 2018) — Getting a lawyer to pursue a case of any nature is an expensive service. It is understandable why some people avoid dealing with litigation when they think about the out of pocket cost. However, there are few and unique ways to acquire the services of an attorney without the high expense that is generally associated with that decision. One scenario is retaining a lawyer that agrees to a contingency fee. A contingency fee arrangement is an excellent option, but it’s important to consider all the stipulations that accompany it.
What is a Contingency Fee?
According to the American Bar Association, a contingent fee arrangement is one in which the lawyer agrees to accept a fixed percentage of the recovery (award), and if the case is a win, the lawyer’s fee comes out of the money awarded to a client. All costs, including fees for filing suit, expert witnesses and investigators is advanced by the lawyer. Losing the case means that neither the client or the lawyer get any money, and the client is not required to pay for the work completed by the lawyer. Simply put, the lawyer only gets paid if the client wins. Lawyers that make this type of arrangement are called “no win, no fee” lawyers. Contingency fee arrangements create an incentive for the lawyer to get the largest settlement possible.
Standard Contingency Fee for an Attorney
The standard contingency fee for an attorney is the agreed upon percentage amount of the award. OpenJurist maintains that “the standard contingency fee in personal injury cases is 33% of the amount of compensation the plaintiff obtains in a settlement, and sometimes, the fee rises to 40 – 50% at a point around 60 to 90 days before the trial.”
Personal Injury Cases a Contingency Fee Arrangement Might Be Applied to
Personal injury cases are the most common type of civil litigation in which a contingent fee agreement is used, and this is a broad category. This can include:
- Automobile Accidents
- Construction accidents
- Dog Bites
- Motorcycle a and Bicycle Accidents
- Railroad Accidents
- Slip and Fall Accidents
- Wrongful Death
- Medical Malpractice
- Unsafe Property
- Defective Products
- Workplace Accidents
- Nursing Home Neglect and Abuse
Contingency Fee Arrangement: Things to Keep in Mind
For the client, contingency fees might appear to be a solid option, compared to paying the lawyer fees out of one’s pocket. However, there are some points of consideration that a client may want to give some thought to before signing. Before you getting excited about a contingency fee arrangement, take into account these possible downsides:
- Be prepared for the possibility of hearing no to taking your case. Some lawyers are more interested in a sure win and a case that is not too difficult.
- The client might win the case, but get a lower settlement amount than anticipated.
- Uncle Sam, the tax man, will want his share, since any award or settlement you receive is usually taxable as ordinary income.
It is not a bad deal not having to pay upfront money to an attorney before a case is pursued, and an award, if any, is handed down to a plaintiff. It could prove beneficial for both the lawyer and client if the case is settled quickly and the award is significant. The client needs to think about what percentage of an award he or she is willing to part with. It important to read a contingency fee agreement thoroughly, especially the fine print, to avoid any unexpected surprises. Contact the lawyers at Sibley Dolman today for a claim evaluation and learn about their contingency agreement.