If you were injured in a car crash or truck accident, you might be concerned about your ability to pay a lawyer. However, you may know you need help to pursue compensation for your medical bills, lost wages, and pain and suffering. Fortunately, contingency fees may help you secure a lawyer’s services without having to pay anything upfront. Here is what you need to know about this type of fee arrangement.
What Is A Contingency Fee?
A contingency fee refers to a payment arrangement in which the fee for professional services is conditioned, or contingent, on a particular outcome. In personal injury cases, this means that attorney’s fees are contingent on the lawyer’s ability to secure a monetary award for their client, typically through a settlement or verdict.
Purpose Of A Contingency Fee
A contingency fee arrangement allows accident victims to retain the services of a lawyer without having to pay any costs upfront. This is particularly important in personal injury cases because the victims did not anticipate needing to pay for these services because they did not plan on getting hurt. This allows them to focus on their health and recovery while having the peace of mind of knowing that a qualified professional is handling their case.
How Does A Contingency Fee Work?
With a contingent fee arrangement in a personal injury case, you do not pay any attorney’s fees upfront. If your lawyer secures financial recovery on your behalf, they take out their fee when you receive your award. If your lawyer is unable to secure financial compensation on your behalf, you do not owe them anything for their services.
Suppose you were injured in a car accident. You hire a lawyer and sign a contingency fee arrangement that states that your lawyer will receive 33% of any award, after expenses. You settle your case for $105,000. You have $5,000 of expenses. Your lawyer deducts the one-third from the $100,000 for their fee, or $33,333. You receive the remainder of the award.
The Louisiana Rules of Professional Conduct govern contingent fees. These rules state that contingent fee agreements must be in writing and signed by the client. You should receive a copy of the agreement at the time you sign it. The fee agreement should state the percentage the lawyer will receive in case of settlement, trial, or appeal.
What Are Other Ways Lawyers Are Paid?
Lawyers may be paid in a variety of ways. Lawyers receive payment in many different ways, which may include:
- Hourly – Many attorneys charge by the hour. They bill their client for the number of hours they worked on their case, multiplied by the hourly rate. For example, if the lawyer charges $250 per hour and works ten hours on the case, the fee would be $2,500. This fee is due regardless of the outcome of the case. Hourly fees are common in many types of law, including business law, family law, and criminal defense.
- Flat fee – Flat fees charge a client a set amount for the legal services regardless of the amount of time the lawyer spends on the case. For example, some lawyers may charge $1,000 for an uncontested divorce or $5,000 for a bankruptcy case.
- Retainer – A retainer fee may work as a down payment toward legal services rendered in the future. For example, a lawyer may charge a retainer of $2,500 and then bill by the hour for the amount that exceeds this portion.
- Statutory fee – Some lawyer fees are subject to state or federal maximums, such as fees in Social Security Disability cases.
- Hybrid – Hybrid fee arrangements may mix two or more different types of fee arrangements.
These other types of arrangements do not base payment of services on the outcome of the case like contingency fee arrangements do. This means that people are generally responsible for attorney fees even if they do not win their case.
Am I Responsible For Other Costs?
In addition to attorney fees, clients may be responsible for other costs associated with pursuing their personal injury claim. These costs may include:
- Court filing costs
- Copy expenses
- Deposition costs
- Subpoena fees
- Discovery fees
- Investigative costs
- Expert witness fees
The Louisiana Rules of Professional Conduct state that the contingency fee agreement must state which expenses are deducted from the recovery and whether the deductions are made before or after the contingent fee is calculated.
How Much Is The Contingency Fee?
The contingency fee can vary based on many factors, including:
- The type of personal injury case
- The complexity of the case
- The time and labor required in the case
- The skill required to perform the services in a proper manner
- Whether accepting the case will prevent the lawyer or firm from accepting other cases
- Whether case is settled or involves litigation
- The parties involved in the case
- Where the case is filed
- The fee charged by other lawyers in the case
- The time limitations related to the case
The fee agreement should clearly outline the percentage of the fee and how it is calculated.
Contact An Experienced Personal Injury Lawyer For Help
The Louisiana personal injury lawyers at Kenny Habetz Injury Law realize that you have been through a traumatic event. We want to help you recover the compensation you deserve. We can explain contingency fees and what to expect with the claims process. Contact us today for a free consultation.