Contingency fees are beneficial to clients because they eliminate upfront legal costs. However, it’s essential to understand contingency fees before signing any agreement.
No Up-Front Fees
The primary benefit of hiring an attorney through a contingency fee agreement is that no upfront fees are associated with the representation. This allows injury victims who could not afford legal services to access professional, experienced New York City personal injury attorneys.
The attorney’s fees are tied to the case results, so they have a strong incentive to build the most substantial possible claim and win maximum client compensation. This system also keeps frivolous claims out of the courtroom, which benefits all injury victims.
When a personal injury attorney charges a contingent fee, they typically will include the details of the fee structure in their client contract, a legal document that all clients should review carefully before signing. The agreement should detail how the fee will be calculated, who will pay the attorney’s costs, and when they must be paid. The attorney should also include language in the agreement that allows them to use co-counsel in complex cases when necessary.
Incentives to Work Hard
Most, if not all, reputable personal injury attorneys work on a contingency fee basis. A contingency fee allows injured victims to pursue justice and obtain compensation without worrying about paying upfront legal fees. It also incentivizes the lawyer to work hard to achieve a successful result in the case.
Before hiring an attorney, carefully read the fee agreement and understand how the lawyer’s contingency percentage is calculated and how litigation costs are paid. Litigation costs can add up quickly, including filing and service of process fees, expert witness fees, transcript costs, and depositions.
Please pay special attention to where litigation costs fall in the calculation, who is responsible for paying them, and any provisions for subrogation, liens, and back medical bills. These items can add up very quickly and impact the overall amount recovered for a client.
No Upfront Costs
The big selling point of personal injury attorneys is that they do not require any upfront retainers. Most civil legal cases require litigants to pay an attorney a retainer, starting at several thousand dollars and going up as the case progresses. It can be costly, and many people will only file a claim if they have the money to do so upfront.
However, most trustworthy personal injury attorneys operate on a contingency fee basis and do not demand an up-front payment. Instead, they take a percentage of any compensation they secure for their clients as a settlement or court award.
It allows people who would otherwise not be able to afford a personal injury lawyer to access the needed services. It also provides a strong incentive for attorneys to win as much compensation for their clients as possible. It is because their compensation is tied directly to their success.
Flexible Payment Plan
Many personal injury attorneys work on a contingency fee basis, meaning they’ll only get paid if they win your case. While these fees aren’t cheap (33% to 40% of any monetary recovery in your case), they allow injury victims access to high-quality legal representation without upfront or out-of-pocket costs.
However, reviewing and understanding your attorney’s fee agreement is essential. Ensure it clearly defines your lawyer’s percentage, when they will be paid out of a settlement or verdict, and how expenses and other costs will be handled (since these are outside of an attorney’s compensation scope). Understanding these terms can help prevent misunderstandings and disagreements between you and your attorney later on in the process. Ultimately, these fee arrangements promote more efficient resolution of cases by incentivizing your attorney to settle your case early on. In this way, you can avoid unnecessary litigation costs and a long wait for compensation.
