How Do Contingency Fees Work in Personal Injury Cases?
After any type of accident, it’s wise to consult with a local personal injury (PI) attorney. You may be eligible for compensation of your medical bills, lost time at work, property damage, and pain and suffering. A conversation with a lawyer can help you learn and pursue your rights to recovery. During your initial consultation, you will probably hear the phrase “contingency fee” when discussing the price of retaining the professional. Almost all personal injury lawyers in San Diego work on “contingency-fee bases.” Understanding exactly what this means will help you as the victim of a car crash or other harmful accident.
How Does a Contingency Fee Work?
In a contingency fee payment arrangement, the client will only pay the attorney’s fees if the attorney wins the case. This protects the client from paying for the lawyer out of pocket without getting any money in return. Contingency fees are important for injured parties. Without this setup, most people could not afford to pay the attorney’s fees outright, especially when dealing with lost income and medical bills from a recent accident. It also ensures the attorney tries his or her best during the case. The attorney won’t receive payment unless the client wins – a good incentive for the legal professional to recover on behalf of the client.
A client will pay a contingent attorney fee in an amount that the client and attorney agreed upon prior to the start of the case. The typical contingency fee amount is one-third of the client’s recovery amount (33.33%). This means that if the claim results in a $100,000 settlement, the attorney’s fees will amount to about $33,330. If you lose the case, the attorney will not receive any money for the work he or she has done. You will only pay the attorney’s fees after a successful settlement negotiation or trial in this payment framework.
Clients should realize that “contingency fee basis” does not mean a free personal injury claim. Win or lose, the client must still pay related fees, such as court and litigation costs. Expenses such as hiring expert witnesses and conducting an investigation will also come from the client. A law firm may pay these fees upfront during the case and then take the price of them out of your compensation should the case be successful. Make sure you understand where these costs will come from if you win or lose before retaining the attorney.
Negotiating an Attorney’s Terms
It is sometimes possible to negotiate the terms of your attorney-client agreement depending on the law firm and the circumstances of your case. Most PI cases reach settlements before ever having to go to trial. It may be possible to agree with your lawyer beforehand, that if your case settles without going to trial (a process that requires less legal work), the attorney receives a lower percentage than if it does go to trial. You may also be able to negotiate a lower percentage if your case is midway when you retain the professional – for example, if the defendant has already responded to your initial claim and you’ve turned down the first settlement offer.
Each law firm operates according to unique rules and fee arrangements. Read the terms of your agreement carefully before signing on the dotted line. Ask the attorney to clarify any points you don’t understand. It is up to you to be vigilant in your search for the right lawyer to represent you. Price isn’t everything when it comes to retaining an attorney, but for some it can be the determining factor. If you hear “contingency fee basis,” make sure the attorney’s terms are similar to what’s described here.
To schedule a free consultation with the personal injury attorneys or car accident lawyers at the Liljegren Law Group, contact us today via phone or online contact form. We will discuss contingency fees in detail after discussing your unique accident and injuries and determining the best course of legal action.