What Does “Contingency Fee” Mean?

Dealing with the aftermath of an injury can be overwhelming, and it’s understandable that you may be concerned about the legal costs associated with pursuing compensation. However, you have options for legal help without paying for a lawyer upfront. 

A contingency fee is a payment arrangement often utilized in personal injury cases. You pay attorney’s fees only if your lawyer secures a settlement or court award on your behalf. This structure ensures that you can pursue justice and compensation without any initial payment during an already stressful time.

How Does a Personal Injury Lawyer Get Paid Under a Contingency Fee Agreement?

Under a contingency fee agreement, the lawyer gets paid by receiving a percentage of any settlement or verdict you may receive. There’s no upfront payment – if your case is successful, the attorney’s fees come as a portion of your compensation. This helps ensure that legal assistance is available regardless of an individual’s ability to pay. If your case is not successful, you aren’t responsible for any attorney fees.

What is the Percentage?

Typically, a contingency fee ranges from 33% to 40% of the total settlement or court award, though this amount can vary. The exact percentage is often determined based on factors such as:

The Complexity of Your Case

More complicated legal matters might require higher percentages due to the increased amount of work and presumed risk associated with winning them. 

The Potential Value of Your Case

Sometimes, an attorney’s percentage might be negotiated based on how much your claim should be worth. In cases that are expected to command higher compensation, a lawyer may agree to a lower percentage because the potential outcome is still significant.

The Stage of Resolution

The agreed-upon percentage can reflect the stage at which your case is resolved. If an attorney successfully settles your case before going to trial, the contingency fee may be at the lower end of the typical range. However, if a case goes to trial – which requires more time, effort, and resources – the percentage might increase. 

No matter what the agreement is, always make sure you discuss the terms upfront and look through the agreement to ensure you understand what your attorney is entitled to and in what circumstances. 

The Benefits of a Contingency Fee Agreement

A contingency fee agreement carries several advantages for clients who have been injured and are seeking legal recourse. The following are some of the primary benefits for those injured by someone else’s negligence

A contingency fee agreement makes competent legal help available to any personal injury client because there is no need for any upfront or out-of-pocket payment. When you need help the most, it will be available.

Incentivizing the Attorney

If your attorney only gets paid upon a successful resolution of your case, they’re going to be very incentivized to get a positive outcome for you. If you don’t get paid, they don’t get paid, so your interests are completely aligned.

Risk Reduction for Clients

You’re protected from major financial risks because you don’t owe attorney’s fees if the case doesn’t result in compensation. This means that you can pursue justice and hold the other party accountable without fear of hefty legal bills should the outcome not be in your favor.

Working with a lawyer under a contingency fee agreement provides you with high-quality legal support for the road ahead. If you’re looking to file a personal injury claim, don’t hesitate to consult an experienced lawyer. 

The Downsides of a Contingency Fee Agreement

While a contingency fee agreement can be beneficial, especially for those who cannot afford to pay upfront fees, it’s important to familiarize yourself with some of its potential downsides:

The Potential for Higher Overall Cost

One thing a client should consider is that the sum you end up paying an attorney under this type of arrangement could exceed standard hourly rates if your case settles for a significant amount. 

An Incentive to Settle Quickly 

Due to the fact that lawyers working on contingency get paid only after a case’s conclusion, there might be an incentive for them to settle your claim swiftly. This motivation could potentially influence an attorney not to take as much time seeking higher settlements or going through a trial.

Additional Expenses Beyond Attorney’s Fees

You might still be responsible for expenses related to your case even if you don’t receive any compensation – such as fees for expert witnesses, court filings, and the cost of obtaining medical records. 

Ultimately, it’s important to discuss these potential additional costs and any concerns with your attorney before entering into a contingency fee agreement.

Contact an Experienced California Personal Injury Lawyer To Discuss Their Contingency Fee Structure

Overall, the benefits of a contingency fee arrangement often outweigh any potential concerns for many clients. If you’re hesitant to pursue legal action due to concerns about cost, contact us today at (424) 622-0812 and we’ll walk you through how this type of agreement might be beneficial for your situation.