What is a contingency fee agreement?
A contingency fee agreement, often used in legal matters, is a fee arrangement between a client and their attorney. Under this arrangement, the attorney's fees are contingent upon the outcome of the case. In other words, the attorney's compensation is based on the successful resolution of the client's legal matter, typically in the form of a settlement or a favorable court judgment. If the case is not successful, the attorney does not receive a fee.
Key features of a contingency fee agreement include (This is not legal advice for any particular claim, and is for informational purposes only):
1. No Upfront Fees:
Clients do not have to pay any upfront or hourly fees to retain the services of the attorney. Instead, the attorney agrees to represent the client without requiring payment at the outset.
2. Payment Upon Success:
The attorney's fee is calculated as a percentage of the monetary recovery obtained for the client. This percentage, often set in advance in the agreement, can vary depending on the type of case and jurisdiction but typically ranges from 20% to 40% of the recovery.
3. Risk-Sharing:
The contingency fee arrangement aligns the interests of the attorney and the client, as both stand to benefit from a successful outcome. If the case is unsuccessful, the attorney does not receive a fee, which can encourage the attorney to work diligently on behalf of the client.
4. Expenses:
In addition to the contingency fee, the client may be responsible for covering certain case-related expenses, such as court filing fees, expert witness fees, and investigative costs. These expenses are usually separate from the attorney's fee and are typically reimbursed by the client regardless of the case's outcome.
Contingency fee agreements are most commonly associated with personal injury cases, such as car accidents, medical malpractice, or wrongful death claims, as well as cases involving class actions, employment discrimination, and some types of civil litigation. These arrangements make legal representation more accessible to individuals who might not be able to afford the upfront costs of hiring an attorney.
It's important to note that the specific terms of a contingency fee agreement can vary by jurisdiction and the nature of the legal matter. Clients should carefully review and discuss the agreement with their attorney to ensure they understand the terms and the attorney's fee structure before proceeding with legal representation.
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This website is informational and is not legal advice on any particular case. John P. Kolb ATTY Ltd. and Trapp & Geller PC.
