How Contingency Fees Work in Personal Injury Cases

Many, if not most, personal injury attorneys work for their clients based on an agreement known as a contingency fee. It allows a person who has been injured to have legal representation even if they do not have the money to pay a lawyer at the beginning of the case.

There are no up-front fees. Instead the plaintiff pays the attorney a percentage of their settlement if they win the case. If the plaintiff loses, the attorney does not collect any fee for the work done on the case. That being said, the plaintiff may have to pay for the costs of the case, including costs for filing with the court, depositions and copies of medical reports, etc. Check with your attorney so that you have a full understanding of the costs you will have to pay in the event that you lose your case.

The basic premise of a contingency agreement is that you, as the plaintiff, will be out little or no upfront expenses. Clients do not pay legal fees unless they win and the lawyer receives a percentage of the award or settlement. Contingency fees are commonly used in cases when a plaintiff is seeking damages for a personal injury received in an accident or on the job. However, lawyers will not always accept a contingency fee arrangement; perhaps if they feel the case is not very strong or if there is some limit placed on the amount of the award by the state (such as a worker’s compensation case).

In some cases, the plaintiff may be able to negotiate a lower fee, but personal injury lawyers usually will not negotiate fees on a contingency case. Many states place limits on the amount of fees a law firm can collect. (InNew York, that amount is 1/3 of the settlement awarded.) Depending upon the contingency agreement, the plaintiff may or may not have to pay fees from the settlement.

Again, it is best to have full understanding of that from your attorney prior to signing the agreement. Before you sign a contingency fee agreement, ask questions to alleviate any concerns you may have. Your attorney will be happy to answer any questions and make you feel comfortable during the entire process. Make sure that you are comfortable with the firm and the attorneys who will be working on your case. As always, hiring an experienced personal injury attorney affords you the opportunity for a more favorable outcome.

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