Contingency Fee
Unless a lawyer takes a case pro bono (free of charge), they charge legal fees. These fees compensate the personal injury or car accident lawyer for their time and work advising and representing the client.
Lawyers use a few different fee structures. Typically, the fee structure represents the type of work they perform. Injury lawyers, for example, know that injured clients do not plan their accidents. As a result, they do not have money saved to pay legal fees.
Therefore, most personal injury lawyers charge contingency fees so their clients can afford their services.
How Do Contingency Fees Work?
Contingency fees might not be familiar to many personal injury clients. The easiest way to explain a contingency fee is to compare it with the other fee structures used by lawyers.
Some lawyers charge hourly fees, which are similar to wages. You pay a lawyer a certain amount for each hour (or portion of an hour) they work on your case. Most injury lawyers do not charge an hourly rate. If they do not win a client any compensation, charging an hourly fee upfront might leave the client with nothing to pay for their medical care.
Flat fees are often used for discrete projects that require a standard amount of work. For example, a lawyer might charge a flat fee of $1,000 to prepare a will. Injury lawyers typically do not charge flat fees because the amount of work for each case is unpredictable. A case could settle early or go all the way to a jury verdict.
Contingency fees are based on the outcome of the case. If the lawyer settles or wins the case, the client pays a percentage of the settlement or jury award. If the lawyer loses the case, the client pays nothing.
The exact percentage a lawyer charges will depend on many factors. According to the Colorado Rules of Professional Conduct, a lawyer should consider the following factors when setting their fee:
- The time and work the case may require
- The complexity of the issues raised
- The lawyer’s experience and skill level
For example, a lawyer might charge a different fee for a complex medical malpractice case than a straightforward car accident claim.
Benefits Of A Contingency Fee
Injury lawyers charge contingency fees for several reasons. First, this fee structure allows experienced and high-quality lawyers to take on a wide range of injury cases. Many accident victims could not afford to hire them if they were to charge an hourly or flat fee.
Another benefit inherent in contingency fees is that lawyers must evaluate cases carefully before accepting a client. Since the lawyer’s fee depends on their likelihood of success, they will focus on cases they feel confident about. In other words, a lawyer will only offer to take your case on a contingency fee if they believe they can win or settle your claim.
Clients also benefit from contingency fees because lawyers start cases without any upfront payments. This means that clients can reserve their cash for medical care and living expenses instead of spending it all on hiring a lawyer.
Services Included With A Contingency Fee
Contingency fees usually cover the lawyer’s time and efforts associated with the case up through trial, if necessary. Specifically, you can expect your lawyer to provide the following services under a contingency fee arrangement:
- Evaluating the strength and value of your case
- Collecting medical records from your healthcare providers
- Gathering evidence establishing liability for your injuries
- Filing an insurance claim with the at-fault party’s insurer
- Negotiating with the claims adjuster to overcome claim denials and settle the case
- Advising you about whether to continue settlement talks or file a lawsuit
- Preparing and filing a lawsuit if negotiations stall
- Conducting discovery to gather additional evidence, including deposition testimony
- Presenting your case to a jury and arguing for an award
There are some services you should not expect to be included. For example, most lawyers will charge a separate fee for any appeals if you lose your case.
Additionally, your contingency fee will not cover litigation costs. Your lawyer may pay certain hard costs to avoid delaying your case. But when it ends, you must reimburse them for the expenses they paid on your behalf. Examples of litigation costs include the following:
- Medical record fees charged by your doctor
- Filing fees charged by the court
- Deposition expenses paid to the stenographer
- Fees and costs to hire expert witnesses
Under Colorado’s ethical rules, the terms of a contingency fee must be in writing. Thus, when you pick a lawyer for your case, review the fee agreement carefully and discuss any questions you have.
Hiring A Lawyer For A Contingent Fee
When you hire a lawyer for a contingent fee, you will sign the fee agreement and a HIPAA release that allows them to request copies of your medical records. Once you hire the lawyer, you will not need to worry about fees until the end of the case. If you have questions about this process or how contingency fees work, consult an experienced injury lawyer.
For a free consultation and to gain insight into contributory fault, reach out to Zaner Law Personal Injury Lawyers today at (720) 613-9706.
