How Do Contingency Fees Work?
If you are seeking legal representation for injuries you suffered in a car accident, at work or in another situation where someone may be responsible for your losses, you probably already know that most personal injury lawyers represent clients on a contingency fee basis. But, what you might not know is that there is a lot more to contingency fee arrangements than simply, “no recovery, no fee.”
The truth of the matter is that (i) contingency fee arrangements can vary from one law firm to the next, and (ii) there are several important considerations you need to keep in mind when you hire a lawyer on contingency.
Contingency Fee Basics
When a lawyer takes your case on contingency, this means that the lawyer receives a percentage of the money recovered for your injuries and losses. If your lawyer is unable to help you secure compensation, he or she does not get paid. Contingency fees are common in personal injury and wrongful death cases because:
- They allow victims to seek compensation without needing to pay hourly rates for their lawyer’s time, and
- By basing the lawyer’s fee on the amount of the recovery, they ensure that the client’s and the lawyer’s interests are fully aligned.
In a typical contingency fee arrangement, there are no retainer fees, no consultation fees and no other upfront or ongoing costs paid to the attorney (if a personal injury lawyer asks for any up-front fees at your initial consultation, you should look for another option).
Are Expenses Part of the Contingency?
When interviewing lawyers to take your case, an important question to ask is whether they include expenses as part of their contingency fees. Some lawyers don’t.
Pursuing personal injury and wrongful death claims is expensive. On top of court costs and filing fees, there may be costs for obtaining records, hiring investigators, paying expert witnesses and a variety of other expenses that are necessary in order to prove your claim for damages. You want to make sure that you will not have to repay these expenses if you lose your case.
Know What You Owe
If you receive a settlement offer, it will be critical to understand how much you owe your lawyer for fees and expenses. If you have outstanding medical bills or liens on your claim, you will also need to how much of your settlement will be going to hospitals and other third parties. If you don’t have to, the last thing you want to do is agree to a settlement that doesn’t cover what you already owe.
When Do I Get Paid?
For many injury victims, this question is at the top of the list. If your case settles through insurance, you can receive a check as soon as a few weeks to a month after the date of settlement. There are potential delays – release forms, resolving lien issues and negotiating for reduced payment obligations – but generally speaking it won’t be too long after your settlement before you get paid.
If your case goes to court, it can take significantly longer to collect what you are owed. Some defendants will pay right away, but oftentimes there will be appeals or your lawyer will need to take further legal action in order to enforce your judgment. These are all factors to keep in mind, and issues your lawyer should discuss with you when evaluating your claim.
Morrow & Sheppard LLP | Experienced Houston Personal Injury Lawyers
At Morrow & Sheppard LLP, we provide experienced legal representation for personal injury and wrongful death claims throughout Texas. We handle all cases on contingency, and we only recover our expenses if we help you secure financial compensation. To discuss your case with one of our attorneys, schedule a free consultation today.