What Exactly Does A Contingency Fee Mean?
Feb. 13, 2024
Most New York personal injury lawyers use contingency fees as a way of payment for services for injury cases. Basically, the firm only charge you fees if they are successful in recovering money the injuries sustained. The lawyer only gets paid contingent of a successful outcome. Contingency fees are a percentage of what the lawyer recovers for your case. The fee if agreed upon when the attorney client relationship is commenced and for the most part in New York the percentage is 33 1/3% of the settlement, verdict, arbitration decision, medication settlement or any other decision. So, if the attorney is unable to obtain you a monetary result you don’t owe them any money for legal fees.
What are the Benefits of Contingency?
The most obvious benefit of having a contingency fee is that you don’t pay any monies unless you win. Besides that it also incentives your lawyer to recover as much compensation as possible as the lawyer is getting a percentage of the winnings. It also allows people who may not have the funds to bring a lawsuit the opportunity to litigate their matter as they lawyer will not be getting payment till the end of the matter and again only if they are successful. Another major benefit of contingent fees is giving people greater access to justice. Contingent fees are a great tool for social equity. Many victims would not be able to afford legal services without contingent fees — at a time they need legal representation most.
Fortunately, contingent fees give people access to proper legal representation without upfront costs.
How is the Contingency Fee Agreed Upon?
At the time that the client decides to hire a specific attorney and the attorney agrees to represent said client the attorney will require the client to sign a retainer agreement. More specifically a contingent retainer. This agreement will state specifically the percentage the attorney will be charging if successful. It will also outline other specifics as to the lawyer/client relationship. This contingent retainer keeps all parties involved on the same page throughout the representation, including on when and how the attorney gets paid. It is very important for a client to review and understand the retainer agreement before they sign the document. The attorney should make an emphasis to completely go through the retainer agreement with the client to make sure the client fully understands the terms. This again will put the attorney and the client on the same page. The retainers will clarify how much you owe the attorney when you win and explain the percentage of a verdict or settlement your lawyer will take for their services. It will also state ant additional fees you or the attorney will take on, including expert fees, court filing fees, fees for medical or other records, and investigator fees . Fees are one of the most common areas of dispute between attorneys and clients. A good contingent fee agreement will explain the details of your payment obligations to your attorney. This knowledge will help you and your attorney avoid arguments related to fees.
What are Typically Other Types of Payment Fees to Attorneys?
The most common type of fees attorneys charge are what are known as hourly fees. The attorney and client agree at the outset how much the attorney will be paid for each hour they work. As you can imagine this could be quite costly to a client as most cases require many hours of work. Many times a person injured in an accident cannot afford to pay such hourly fees, which is why a contingent fee is attractive. Another type of lawyer payment is a flat rate fee. This is usually paid up front and the attorney and client agree on a set number that the attorney will be paid no matter what the outcome of the case. Again, these fees are not usually cheap and even if the attorney loses the fee is still paid, which again is a reason a contingency fee is usually preferred for a client. In some instances at attorney will ask for a retainer fee up front and then charge an hourly fee. This is again not based on outcome. The upfront retainer is not usually as high as a straight upfront fee which clients prefer but they are still paying an hourly fee and again costs can add up pretty quickly. Unlike a contingency fee, where you don’t pay a penny unless your lawyer recovers damages, these alternatives require payment even if you lose. If the client loses, they have unpaid medical bills and lost wages from an accident — and they have a bill from their lawyer!
Still Confused, Feel Free to Contact The Law Offices of Spencer M. Fein, P.C.
If you're dealing with injuries, you've got enough on your plate with just healing and getting back in the swing of things. Hiring a Briarcliff Manor and Westchester County, NY personal injury attorney is a step in getting your peace of mind back. Contact Spencer M. Fein today for your consultation and make sure your future is protected.