Paying Your Personal Injury Attorney: 3 Factors To Consider When Looking At The Contingency Fee Agreement

If you have a personal injury case on your hands, you need to consider how you are going to pay your legal fees before you proceed. If you most definitely know that you're going to win and if you have the liquid capital needed to pay your legal fees immediately, you might want to opt for an hourly pay rate; however, most of the time, clients will want to opt for a contingency fee, which basically means that the attorney receives anywhere from 33 percent to 40 percent of the compensation you are awarded. If you lose, you don't have to pay a single cent. Before signing the contingency fee agreement, take the following 3 factors into consideration.

Whether the Fee Is Tiered Based on Amount of Compensation Awarded

Each personal injury attorney sets their own fees based on the amount of experience that they have in the field and how comfortable or confident they are in the case. Instead of settling for a fixed contingency fee rate, you might benefit from a tiered system that will ensure that you get more compensation should the compensation amount awarded be higher than expected. It's vital that the tiered system is also beneficial to your personal injury attorney in order to encourage and motivate them to put in the necessary effort.

For example, both you and the attorney might agree to limit the contingency fee to 40% to the first $50,000 awarded. Your attorney will only receive 35% of the next $50,000 compensated, and 33% for the next $100,000 awarded.

Whether the Contingency Fee Covers ALL Legal Expenses and Costs of Filing a Case

Take a look at the terms and the conditions of the contingency fee contract to scrutinize what exactly is covered by the fee. It's vital for you to determine whether the contingency fee only covers the cost of the lawyer's fees, which is the amount of billable hours that the attorney has put into your case. Don't forget that you'll also have to pay the legal fees to file a case in court and other expenses related to the case as well. For example, if you hired a medical expert to provide testimony on your behalf, you'll have to pay the medical expert too.

The contingency fee agreement should clearly outline what expenses are covered by the contingency fee and what expenses are left over. It's important to take into consideration what the final compensation amount you will receive based on estimated additional expenses that will accrue over the length of the case.

Whether the Fee Seems Reasonable Based on the Circumstances of the Case

Do you have a substantial amount of evidence on your hands that will make your personal injury attorney's life and work much easier? If you do, then you probably know that your attorney won't have to put in as much effort in your case as in a case where the client has no evidence or proof to back up their claims at all. In addition, do you have a good idea what the chances of winning might be? Or what the estimated settlement amount you should be offered is?

Take all of the circumstances that surround your case into consideration when determining whether the fee quoted to you by the attorney is reasonable or not. The fee is based on not only the circumstances of the case, but also the amount of experience that the attorney has in the field. Naturally, if you hire a big shot lawyer with a high settlement success rate, you're going to have to expect to pay more in contingency fees.

Most personal injury attorneys are more than willing to negotiate their contingency fees with you if you deem them to be unreasonable. They are also usually willing to sit down and break down why they charge a certain amount to help you determine whether it's worth hiring them for their services.