Private lawyers charge for legal services, though the way they receive payment is most often based on their clients’ needs and situations. The typical billing structures used by lawyers include hourly, flat, and contingency fees.
When lawyers charge hourly fees, they track their time working on a case and bill the client accordingly. The client pays the fee whether they win or lose. Flat fees are generally reserved for projects with a predictable amount of work, like writing a will. Like hourly fees, flat fees must be paid whether the lawyer wins or loses.
Injury lawyers typically do not charge hourly because many accident victims do not have the money to pay legal bills during the case. Similarly, they often do not charge flat fees because they cannot predict the amount of work an injury case might require. Instead, injury attorneys prefer to charge contingency fees.
The defining aspects of a contingency fee are that it is paid at the end of a case and that the outcome produced by the lawyer determines its applicability. The client pays the fee if the lawyer wins or settles the case. The client owes no legal fees if the lawyer loses the case.
The fee itself is generally an agreed-upon percentage of the compensation recovered in a settlement or court judgment. Sometimes, a lawyer may charge a different rate depending on when the case ends.
For example, suppose that you hire an injury lawyer for a car accident injury case. If your lawyer resolves the case during the insurance claim, you’ll pay them a percentage of the total settlement amount. If the insurer refuses to settle and your lawyer must file a lawsuit, you may pay a higher rate because of the additional work involved.
A contingency fee has many benefits for injured clients. Many need to conserve their cash for medical care, and they might not be able to work unless they recover. As a result, they usually do not have the money to pay an hourly or flat fee. A contingency fee gives these clients access to high-quality legal representation without the need to pay out-of-pocket.
Since a contingency fee is paid at the end of the case, the lawyer can start working on the case without any upfront payment. That, in turn, frees the client to focus on their health rather than trying to find the money to hire a lawyer.
Moreover, it allows the client to obtain legal representation without seeking financial assistance from others. For example, if a client suffers a brain injury that permanently prevents them from working, a contingency fee allows a lawyer to take the case without relying on the client’s friends or family members to raise the money to pay for legal services.
A contingency fee covers most legal services provided during your personal injury claim, including the following:
Your contingency fee will not cover case costs, which are expenses paid by your lawyer on your behalf during the case. At the end of the case, you’ll reimburse the lawyer for the charges they incurred, which may include things like:
When you meet with lawyers to discuss your case, ask about fees. Make sure you understand the percentage you will be charged and whether that percentage will change based on the stages of the case.
The Texas Disciplinary Rules of Professional Conduct define the rules that govern contingency fees. Specifically, Rule 1.04 states that a lawyer must provide a written fee agreement that states how the fee will be calculated.
Once you choose a lawyer, review their fee agreement carefully. If you have any questions, it’d be in your best interests to ask them before signing the agreement.
Contingency fees are beneficial to clients because they can access legal representation without any upfront costs. If you’ve been injured in a car accident or other incident, consult with an injury lawyer at McMinn Personal Injury Lawyers for a free consultation to discuss how contingency fees work and how they can benefit you.
