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How Does a Contingency Fee Work in a Personal Injury Case?

A contingent fee, also referred to as a contingency fee, is an attorney’s fee that is paid only if there is a successful outcome. This type of fee arrangement is typical for personal injury cases. Here is an overview of how contingency fee agreements work and what to expect if you hire a personal injury attorney on a contingency basis.

What Is the Contingency Fee for Personal Injury?

A contingency fee means that the attorney receives payment for their services only if money is recovered in the case. The fee amount is a percentage of the total settlement or court award. The client does not pay any attorney fees if no money is received. Contingency fees typically range from 33% to 40% of the recovered amount.

This type of arrangement provides clients who have a strong personal injury case with improved access to legal representation that they may not be able to afford otherwise. Attorneys are more willing to accept cases when payment is contingent on a successful outcome. Clients also benefit because contingency fees shift some of the risk of litigation over to the attorney.

Additionally, contingent fees align the interests of the attorney and client. Because compensation is tied directly to case results, the attorney is motivated to secure the largest recovery possible under the circumstances. This gives clients extra assurance that the attorney will work diligently on their behalf.

Establishing a Contingent Fee Agreement

Clients and attorneys discuss payment details upfront when entering into a contingency fee contract. Important terms that are established include:

  • Percentage of recovery amount: This is typically a standard percentage based on case type and attorney expertise. Some firms have sliding scales depending on the case stage reached.
  • Case expenses: The agreement states whether litigation expenses are paid separately by the client or deducted from the settlement/award before splitting the remainder.

Once the percentage amount and key details are agreed upon in writing, personal injury lawyers California fully take on case preparation and litigation at their own expense. Payment only comes from settlement funds or court awards later, if any.

Pros of Contingency Fee Agreements

Hiring a personal injury attorney on a contingency basis has several notable advantages:

  • No upfront costs: Attorney fees are only paid if the case is successful, so no out-of-pocket payment is required to initiate the case.
  • Access to experienced counsel: Makes strong cases affordable despite a client’s immediate financial constraints.
  • Motivated representation: The attorney has a direct financial stake in maximizing the recovery amount.

So, while contingent fee arrangements expand legal accessibility, clients should weigh the benefits versus the potential drawbacks when hiring a personal injury lawyer.

Case Expenses

Hard costs related to contingency fee personal injury cases may still be the client’s responsibility, depending on what is outlined in the initial agreement. Standard expenses include:

  • Court filing fees
  • Service of process charges
  • Costs related to obtaining medical records
  • Expert witness fees
  • Deposition transcription costs

Such expenses can add up over the course of litigation. Some car accident attorneys California cover them fully and take reimbursement out of the final settlement or award before calculating their percentage fee payment. Others require clients to pay a portion of expenses separately as they are incurred. This is an important detail to clarify upfront.

Termination Clauses

Another key provision addresses what happens if the client chooses to terminate the attorney’s services at some point or settles independently without the attorney’s involvement. Well-crafted contingency fee contracts include termination clauses that protect both parties’ interests in this scenario.

Typical terms require the client to pay reasonable attorney fees based on work performed up to the termination date. This compensation rate is usually lower than the original contingency fee percentage. Standard hourly charges or fixed fees based on case stage progression at termination are common.  However, the termination of an attorney is governed by state law.  You can terminate your lawyer at any time without having to pay a dime.

Getting the Maximum Settlement

While contingency fee agreements greatly improve access to experienced personal injury counsel, it is still important for clients to understand what a reasonable settlement amount is for their case. Attorneys may be incentivized to push for a quick settlement so they get paid faster, even if holding out longer could potentially increase the total value.

Clients should educate themselves on typical settlement ranges for similar cases and injury types. Consult experienced motorcycle accident lawyers California with a strong track record of maximizing recoveries, not just quickly settling. Ask plenty of questions to understand how the attorney evaluates cases and arrives at a recommended demand amount.

Additionally, find out if the attorney is willing to finance extra expenses necessary to bolster claims, like hiring specialized medical experts. Such upfront investments can significantly strengthen a case and result in a higher settlement later. The best personal injury law firms utilize sufficient case financing combined with aggressive litigation and negotiation tactics to obtain maximum payouts for their deserving clients.

Get Legal Guidance After an Injury

Suffering any kind of disabling injury can be devastating, both physically and financially. Contact a personal injury law firm as soon as possible after an accident to understand your rights. An initial consultation is often free. At Karns & Karns Personal Injury and Accident Attorneys, we have extensive experience representing injury victims throughout California, Nevada and Texas. We provide knowledgeable legal guidance and work on a contingency fee basis, ensuring access to quality representation for clients without sufficient funds to pay high hourly attorney rates. Connect with our attorneys today to discuss your situation confidentially.

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