Why do attorneys take personal injury cases on a contingent fee basis? We hear this question from time to time and it is a subject worthy of discussion.
Let’s say you dislocate your shoulder as a result of a slip and fall on a slippery patch of sidewalk in front of a store in a shopping center. As a result of your injury you are unable to work as an orthodontist (your chosen profession) and you are prevented from playing golf (your favorite sport) for several months during the summer. Do you have a case? How much is it worth? Who is at fault? Whom should you sue?
Contingent fee cases allow a skilled attorney to investigate and pursue potential claims without you, the client, incurring any serious financial burden. Are you prepared to spend many hours and several thousand dollars to find out whether you have a good claim in the first place? Most people are not.
There are many good reasons for the contingent fee basis for handling personal injury cases. Consider the following benefits of the contingent fee arrangement:
Attorney’s Fees. A typical contingent fee arrangement results in your receiving a percentage of the settlement or verdict in your favor (often two-thirds) with your attorney receiving the balance (often one-third). In some cases, lawyers charge more than one-third, but any arrangement exceeding one-third should be scrutinized carefully by the client. Riskier cases or complicated claims sometimes justify a higher percentage for the attorney, but more often than not, it is the unscrupulous practitioner who seeks significantly more than one-third to handle an ordinary personal injury matter.
Risk v. Reward. What happens if your case goes to trial, and the jury determines that you slipped and fell on a bit of ice cream that had just been dropped by the young child of another shopper only minutes before your fall and before the store owner had notice or an opportunity to clean it up? On these facts, the only negligent party might be the child who dropped the ice cream, and small children are legally incapable of negligence. Your recovery could be zero. In the unlikely event you do not recover, you would owe your attorney nothing on account of counsel fees. Your attorney is taking a significant risk (in the form of time invested and money) that he or she can recover successfully on your behalf.
Delay of Recovery. Another benefit to the client of the contingent fee arrangement has to do with an inevitable aspect of our present judicial system – delay of recovery. Because of court backlogs, even the best cases can be years away from successful trial or settlement. Counsel fees are recovered only when paid by the defendant (or the defendant’s insurance company). Your attorney might be handling your case for several years without receiving any payment at all. Only when success is achieved through settlement or jury verdict is he or she paid. Were it not for this type of arrangement, most clients would not be able to afford to bring their cases to trial; this is especially true where the defendant is a major corporation or other well-staked defendant.
The contingent fee system has many benefits to both attorney and client. Provided the attorney’s percentage of the recovery is within reason, the attorney is fairly compensated for his or her services and the client has the potential for a significant percentage of the recovery without serious financial risk. Our experience with these arrangements has been good and we encourage their use in the appropriate case.
Let’s say you dislocate your shoulder as a result of a slip and fall on a slippery patch of sidewalk in front of a store in a shopping center. As a result of your injury you are unable to work as an orthodontist (your chosen profession) and you are prevented from playing golf (your favorite sport) for several months during the summer. Do you have a case? How much is it worth? Who is at fault? Whom should you sue?
Contingent fee cases allow a skilled attorney to investigate and pursue potential claims without you, the client, incurring any serious financial burden. Are you prepared to spend many hours and several thousand dollars to find out whether you have a good claim in the first place? Most people are not.
There are many good reasons for the contingent fee basis for handling personal injury cases. Consider the following benefits of the contingent fee arrangement:
Attorney’s Fees. A typical contingent fee arrangement results in your receiving a percentage of the settlement or verdict in your favor (often two-thirds) with your attorney receiving the balance (often one-third). In some cases, lawyers charge more than one-third, but any arrangement exceeding one-third should be scrutinized carefully by the client. Riskier cases or complicated claims sometimes justify a higher percentage for the attorney, but more often than not, it is the unscrupulous practitioner who seeks significantly more than one-third to handle an ordinary personal injury matter.
Risk v. Reward. What happens if your case goes to trial, and the jury determines that you slipped and fell on a bit of ice cream that had just been dropped by the young child of another shopper only minutes before your fall and before the store owner had notice or an opportunity to clean it up? On these facts, the only negligent party might be the child who dropped the ice cream, and small children are legally incapable of negligence. Your recovery could be zero. In the unlikely event you do not recover, you would owe your attorney nothing on account of counsel fees. Your attorney is taking a significant risk (in the form of time invested and money) that he or she can recover successfully on your behalf.
Delay of Recovery. Another benefit to the client of the contingent fee arrangement has to do with an inevitable aspect of our present judicial system – delay of recovery. Because of court backlogs, even the best cases can be years away from successful trial or settlement. Counsel fees are recovered only when paid by the defendant (or the defendant’s insurance company). Your attorney might be handling your case for several years without receiving any payment at all. Only when success is achieved through settlement or jury verdict is he or she paid. Were it not for this type of arrangement, most clients would not be able to afford to bring their cases to trial; this is especially true where the defendant is a major corporation or other well-staked defendant.
The contingent fee system has many benefits to both attorney and client. Provided the attorney’s percentage of the recovery is within reason, the attorney is fairly compensated for his or her services and the client has the potential for a significant percentage of the recovery without serious financial risk. Our experience with these arrangements has been good and we encourage their use in the appropriate case.
– Curt Ward