In most legal matters, we are proud to offer our services to you on a contingency fee basis. Having said that, many people are not aware of what exactly a contingency fee is. We hope this info helps.
A contingent fee is a fee for services provided where the fee is only payable if there is a favorable result. The law defines a contingent fee as “a fee charged for a lawyer’s services only if the lawsuit is successful or is favorably settled out of court…contingent fees are usually calculated as a percentage of the client’s net recovery.”
For many injured consumers, the contingent fee is their key to the courthouse doors. It makes it easier for people to protect and pursue their civil rights—especially in personal injury and wrongful death cases. If the right attorney is selected, a contingent fee is an excellent way to hire one of the best lawyers in your state without having to pay his or her up front retainer or hourly fee. Truly a win-win for the consumer.
Because of the high risk involved, few attorneys will take cases on a contingency basis unless they feel the case has good merit. And when you think about it, that makes perfectly good sense.
The Contingent Fee Structure- A client is not charged attorney fees if he or she loses the case. If the client recovers damages from settlement or a favorable verdict, the attorney receives a previously agreed to fee from the recovery.
The attorney’s permitted fee varies depending on the country, and even local jurisdictions. The percentage allowed is subject to the ethical rules of professional conduct, and in many circumstances, statutory limitations. Depending on the age of the client and type of case, this range is normally someplace between 25% to 40% in the State of California.
The Advantages of a Contingent Fee Structure- A contingency fee arrangement provides access to the courts for those who cannot afford to pay the attorneys fees and costs of civil litigation. Contingency fees also provide a powerful motivation to the attorney to work diligently on the client’s case.
In other types of litigation where clients pay the attorney by the hour for their time, it makes little economic difference to the attorney whether the client has a successful outcome to the litigation. Finally, because lawyers assume the financial risk of litigation, the number of speculative or unmeritorious cases may be reduced.
In the United States, contingency fees are the standard in personal injury cases and are less common in other types of litigation. Most jurisdictions in the United States prohibit working for a contingent fee in family law or criminal cases, as made clear in Rule 1.5(d) of the Model Rules of Professional Conduct of the American Bar Association.
It’s interesting to note that in addition to the United States, contingent fees are also allowed and utilized in many other countries such as Australia, Brazil, Canada, the Dominican Republic, France, Greece, Ireland, Japan, New Zealand, the United Kingdom and the United States.