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Who pays for the costs in my case? Are they included in the percentage fee?

who pays fees car accident

How are case-related expenses are paid?

In most personal injury cases, attorneys representing injured individuals assess what is known as a contingency fee. An injured person needs to understand the mechanics of a contingency fee when retaining legal counsel. Questions regarding contingency fees usually include how case-related expenses are dealt with between an attorney and client.

Contingency Fee Overview

In a contingency fee agreement a client pays no fee until his or her attorney obtains a favorable settlement or judgment. The fee in a contingency agreement is set as a percentage of the settlement or judgment obtained in a particular case. Alternatives to a contingency fee are an hourly or flat fee arrangement.

Case-Related Expenses

A common question when discussing a contingency fee arrangement is how are the costs associated with pursuing a case addressed? Are costs part of the contingency fee percentage paid to an attorney at the successful conclusion of a case?

The costs associated with a case are not typically included as part of the percentage set aside to the lawyer as his or her fees. Case-related expenses represent something separate and apart from the attorney fee.

As a result, upon the successful resolution of the case, not only are attorney fees deducted from the settlement or judgment, but so are the expenses incurred in pursuing the case. Practice standards established in codes of professional responsibility, by the American Bar Association, and by state bar associations dictate that expenses are deducted from the settlement or judgment initially. Once this is done, the balance of the settlement or judgment is the amount utilized to computer the percentage paid to a lawyer in attorney fees.

Hammering Out a Fee Agreement

Making certain the financial responsibilities of the parties are clear in a contingency fee agreement is crucial. This includes not only the percentage to be paid to an attorney, but detailed information about how the costs and expenses associated with a case are to be handled.

Nearly always an attorney presents a client with a standard form fee agreement. Despite the presentation of a template agreement does not mean that a prospective client loses the right to discuss the terms and conditions of the fee contract. In addition, no matter the genesis of the fee contract, a person seeking legal representation must closely review the contents of the agreement. He or she must be certain to understand all components of the agreement, including how costs associated with the case are addressed.

Expenses When a Case is Lost

Not all personal injury cases are settled in favor of a client. Not all personal injury cases are successful in court. A key consideration an injured person seeking legal representation must understand is how the costs of the case are handled if the injured person is not successful in obtaining a favorable settlement or judgment.

Costs in an unsuccessful case represents an area in which attorneys take different approaches. On the one hand, there are attorneys and law firms that eat the costs associated with a lost case. On the other hand, there are lawyers and firms that assess the costs to the client if a case is not successful.

What happens regarding fees in an unsuccessful case must be clearly spelled out in a fee agreement and completely understood by a client. A client must understand the risk he or she bears in pursuing a case.

If a lawyer is willing to take a case he or she perceives as not be particularly strong, that attorney may require the client to be responsible for costs, win or lose. Conversely, if a lawyer sees a case as particularly strong, he or she is likely to have little issue assuming responsibility for expenses no matter the ultimate outcome of the case.

Retain Legal Counsel

The initial discussion of attorney fees and case costs should begin during an initial consultation with a personal injury attorney. A personal injury lawyer or law firm usually charges no fee for an initial appointment to discuss various aspects of the case and legal representation.

The Lamber Goodnow legal team, together with our personal injury law firm firm partners in Chicago, are well-versed in these matters. Our Chicago personal injury lawyers never charge a fee, unless we win your case. Get a risk free consultation today.

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