– HOW DO CONTINGENCY FEES WORK?
Most attorneys who work in the personal injury field work on a contingency fee basis. This means that the attorney gets paid a percentage of the amount of money obtained for the client. The amount of the fee is “contingent” upon the outcome of the case. If the case does not resolve with an amount of money to the client, then the attorney would not receive anything for their work. The attorney will receive more money as the amount of the award or settlement goes up because they are taking a percentage of the award or settlement.
Attorneys are willing to take this type of risk because they are expecting to be rewarded down the road. This type of arrangement is particularly useful for most clients because they do not have to pay anything out of pocket in order to have someone help them with their legal claim. The amount of the percentage is something that is agreed upon in writing between the client and the attorney before the representation begins. Most attorneys who work in the personal injury field charge somewhere in the neighborhood of one third, or 33.33 percent. Many attorneys will charge more than this for cases that are inherently more difficult than the average personal injury case. Medical malpractice cases, for example, often have a charge of 40-50%. The increase in the fee is representative of the increased amount of work, the increased amount of risk of a poor outcome (many very good medical negligence cases do achieve a plaintiff’s verdict), and the increased risk associated with funding the case.
In contingency fee work, not only do most attorneys agree to wait to be paid upon the outcome of the case, but they will also front the costs necessary to move the case forward through the justice system. While some cases can be resolved without the need for a lawsuit and with only the need to obtain and pay for the client’s medical records (the evidence in an injury suit), in more complex cases the attorney may pay costs for expert witnesses and investigations that go well into the tens of thousands of dollars. Whatever the costs that are funded, the client in Washington state needs to understand that they are ultimately responsible for the repayment of the costs in their own case, even if the attorney originally paid them. This is a completely different analysis than the attorney’s fees, which are contingent on the award of money to come into being. In a case where no award is given, the client owes the attorney nothing for fees, but would be responsible for paying the costs incurred. It is not ethical for an attorney in Washington to make an agreement with a client that the client would not be responsible for the repayment of costs. Any attorney doing so is not being straight forward with their client.
At Wiener and Lambka, PS we charge different rates of contingency fees depending upon the nature of the case. For example, we charge less to children in injury claims. We charge more for medical negligence claims for the reasons discussed above. We charge less if a case settles without the need for a lawsuit. We are also effective in keeping our fees low as we resolve about 85% of our cases without needing to file suit.