After a serious accident, money can become a concern almost immediately. Medical bills arrive while you may be missing work and losing income, and your family may already be cutting expenses. For many personal injury victims, the question is simple: How am I supposed to afford an attorney right now?
A contingency fee arrangement helps answer that question. Instead of paying attorney’s fees upfront or receiving hourly legal bills, the attorney’s fee depends on whether the case results in a financial recovery. For people injured through someone else’s negligence, this arrangement can make experienced legal representation accessible when they need it most.
What Does “Contingency Fee” Mean?
A contingency fee is an attorney’s fee that depends on the outcome of the case.
In a typical personal injury case, the client does not pay the attorney an hourly rate for every phone call, letter, or court appearance. Instead, the lawyer agrees to receive an established portion of the financial recovery if the case succeeds.
If the lawyer obtains a settlement or verdict, the attorney’s fee is calculated according to the agreement between the lawyer and client. That written agreement allows the client to understand the financial arrangement before moving forward.
Why Are Contingency Fees Common in Personal Injury Cases?
After a major accident, an injury such as a broken bone, spinal injury, or traumatic brain injury may keep you from working. At the same time, medical bills and other expenses can add up while an insurance company has attorneys and adjusters working on the claim.
Paying a lawyer hundreds of dollars per hour may simply be impossible. A contingency fee allows an injured person to pursue a claim without paying attorney’s fees upfront. Instead, the attorney takes on the risk of pursuing the case, allowing the client to seek compensation without choosing between household expenses and legal representation.
How Does a Contingency Fee Level the Playing Field?
Insurance companies usually have substantial resources, including adjusters, investigators, and defense attorneys who understand how personal injury claims work. An injured person might not have access to those same resources, and that imbalance can become especially noticeable in serious cases.
Proving a claim may require:
- Extensive investigation
- Depositions
- Medical evidence
- Expert witnesses
- Accident reconstruction
- Litigation
A contingency fee arrangement gives ordinary people a way to hire legal representation without substantial upfront funds. An attorney can investigate the accident, negotiate with the insurer, and prepare the case for trial if necessary, making access to the justice system less dependent on how much money someone has in the bank.
How Much Is the Contingency Fee?
There is no single percentage that applies to every personal injury case. The amount depends on the agreement between the attorney and client. Texas professional conduct rules prohibit lawyers from entering into an arrangement for, charging, or collecting an illegal or unconscionable fee.
A contingency fee agreement may also provide different percentages depending on how far the case progresses. For example, the agreement might distinguish between a case that settles before litigation and one that requires a trial or appeal. The actual terms should be clearly stated in the written agreement.
Before hiring an attorney, you should understand exactly how the fees will be calculated.
What Happens to Case Expenses?
Attorney’s fees and case expenses are not necessarily the same thing.
Building a personal injury claim can involve costs associated with:
- Obtaining medical records
- Court filing fees
- Depositions
- Expert witnesses
- Accident reconstruction
- Medical evaluations
- Other litigation expenses
The contingency fee arrangement should explain how these expenses will be handled. Clients should review the provisions of the agreement carefully. Make sure to ask questions about anything you do not understand.
How Does a Lawyer Get Paid After a Settlement?
Suppose your attorney negotiates a settlement with an insurance company. The settlement does not usually become a check that simply gets handed directly to the client. Several things may need to be addressed first.
Depending on the case, the settlement funds may need to account for:
- The agreed attorney’s fee
- Case expenses
- Medical liens or other valid reimbursement claims
- The remaining amount payable to the client
At the end of your case, your attorney should provide you with a written statement explaining the outcome. This statement should show the total client recovery and how the amount was calculated. This will give you a breakdown of where the settlement money went.
What Should I Ask About Before Signing a Contingency Fee Agreement?
Before hiring a personal injury attorney, take time to understand the contingency fee agreement. The agreement should explain how the attorney’s fee will be calculated and how case expenses will be handled.
Consider asking questions such as:
- What percentage will the attorney receive?
- Can the percentage change if a lawsuit is filed?
- Who is responsible for case expenses?
- When will expenses be deducted?
- What happens if the case does not result in compensation?
- How will the final settlement be distributed?
Do not hesitate to ask about language you do not understand. Knowing how fees and expenses work from the beginning can help prevent confusion later in the case.
Contact the Houston Personal Injury Lawyers at The de la Garza Law Group for Help Today
A serious injury should not create a justice system where only people with substantial wealth can afford to pursue a claim. Contingency fees provide another path.
If someone else’s negligence injured you in Houston, TX, don’t be afraid to reach out for help. Contact The de la Garza Law Group at (713) 784-1010 for a free consultation today. Our Houston personal injury attorneys can explain your legal options and discuss how a contingency fee would work in your particular case.
