What Does It Mean When a Lawyer Works “On Contingency”?

Oct 3, 2018 | General Personal Injury

Many car accident lawyers in Arizona state that they work “on a contingency basis,” a phrase that can be confusing for people who have never needed a lawyer’s service in the past.

A contingency fee agreement is a contract that states your lawyer will work on your case, but that you will only pay their fee for that work if the lawyer recovers some money for you, either through a settlement or a trial verdict. Certain costs, like the costs of postage or filing court paperwork, will be your responsibility. Some attorneys pay the costs until and unless the case settles or you win at trial. Other attorneys will require that you pay costs out of your pocket as they are due. Always discuss how costs are handled with each attorney that you meet with.

Typically, a contingency agreement sets the lawyer’s fee for the work at a percentage of the final settlement or judgment amount. The amount varies depending on state or local laws and the percentage agreed upon by the lawyer and the client, but 30 to 40 percent is common in many areas.

Contingency fees are not available in all cases. Personal injury cases frequently are pursued on a contingency basis, as are product liability claims when a defect causes harm, and harassment claims under the Fair Debt Collection Practices Act (FDCPA). Certain employment law, wage and hour claims, and large debt collection claims may also be pursued on a contingency basis.

Some types of cases are never taken on contingency, due to the significant ethical issues caused by the contingency arrangement. These include criminal defense, adoption, immigration, and divorce cases.

Contingency fee agreements benefit injured persons under the right circumstances. Two major benefits clients may receive from a contingency agreement are:

  • No payment up front. Being reassured that the attorney will be paid as part of your settlement can help you avoid the trouble of finding enough money for an experienced lawyer when you’re already struggling with the effects of a serious injury.
  • A different perspective on your case. Attorneys typically offer contingency agreements only in cases where they believe you are entitled to a substantial award. Typically, lawyers consider carefully whether or not the case can be resolved in a way that benefits you while also compensating the attorney fairly for their work. If your case can’t be won, a lawyer likely will not offer a contingency agreement.

When asking attorneys about their terms for contingency agreements, also ask about associated costs. This will help you maintain a sense of what you’ll need to pay out of pocket whether or not you win.

Keep a notebook and a file of your paperwork related to your claim, including copies of all receipts for expenses related to the claim, like medical bills, repair bills, and pay stubs for missed work. This documentation can help your lawyer build a stronger case and obtain a more substantial settlement amount – or show a jury why you deserve the damages award your lawyer may ask for at trial if settlement negotiations fail.

If you’ve been injured in an accident, don’t hesitate to contact an experienced personal injury lawyer. We at the Folger Law Firm are dedicated to helping our clients seek the compensation they deserve. We work on a contingency basis, so you won’t pay fees unless we recover for you. Contact us today to discuss your case.