Coronavirus alert: To protect you from COVID-19, we are now offering a quick and easy remote intake process via phone, FaceTime or Skype.

You Pay Nothing Until
We Win
Free Case Evaluation
Free Case Evaluation

What Is It Called When a Lawyer Only Gets Paid If He Wins?

Posted in California Law,Car Accident,Personal Injury on March 14, 2019

If you suffer from a personal injury in California, you may wonder what your legal options are, especially if you do not have the funds to pay expensive legal fees. In fact, many people refrain from pursuing legal action because they believe they cannot possibly afford an attorney out of pocket. However, many law firms offer agreements to help make attorneys more accessible and affordable for California residents. These agreements are contingency fee arrangements.

What Is a Contingency Fee?

A contingency fee is a fee arrangement that many law firms adapt to help lower your out-of-pocket costs when filing a personal injury lawsuit. Simply put, if the accident attorney you hire does not secure a settlement on your behalf, you do not have to pay him or her any legal fees. If your attorney does secure a settlement on your behalf, he or she will deduct an agreed-upon percentage from the final settlement amount as payment.

Your attorney will inform you of the percentage he or she intends to collect before you decide to hire him or her. Your attorney should also let you know if he or she intends to deduct any additional costs and expenses related to your case as well, such as filing fees or report request costs. This arrangement provides you with a very low-risk path to receiving the legal services you need to recover compensation.

How Much Are Contingency Fees?

The contingency fee you will pay depends on which law firm you decide to hire. Most personal injury attorneys charge a contingency fee of 33.3% if your case does not go to trial and 40% if the lawsuit does enter the courtroom. The majority of personal injury lawsuits actually settle out of court via negotiations. Your attorney may not make a distinction between these two types of settlements, charging a flat contingency rate for either outcome.

For example, say that you suffer injuries in a car accident and you sign the standard contingency fee agreement with your attorney: 33.3% if your case settles out of the courtroom and 40% if your case goes to trial. If you settle outside of the courtroom and receive compensation totaling $50,000, your attorney will receive $16,650 for legal fees and you will receive $33,350. If your case does go to trial and you receive a $50,000 settlement, your attorney will receive $20,000 for legal fees and you will receive $30,000.

The Importance of Contingency Fee Arrangements

While contingency fees may seem quite high, they actually come at a little risk to you and provide a way to receive top quality legal services without paying expensive fees out-of-pocket. Contingency fee agreements can provide numerous benefits to people who are trying to file a personal injury lawsuit, namely in terms of accessibility and incentive.

  • Legal services are not free in the first place, and you will have to pay legal fees regardless of contingency fee arrangements. Hiring an attorney with a contingency fee agreement will help you receive legal services and resolve the payment arrangement without additional stress.
  • Contingency fee agreements also give your attorney an incentive to win your case. If he or she does not secure a settlement, your attorney does not receive payment. As a result, your attorney will work as hard as possible to reach a successful outcome.
  • Contingency fee arrangements provide a low-risk method of pursuing a personal injury lawsuit. If you had to pay out-of-pocket to simply obtain an attorney to represent you, you could lose out on thousands of dollars if you do not receive a settlement. You only pay these legal fees if you win, and you are not charged legal fees in the case of an unsuccessful outcome.

If you are seeking an attorney to represent you in your personal injury claim or lawsuit, consider hiring an attorney who offers a contingency fee agreement. While you will have to pay funds out of your settlement to this attorney, legal services are not free in the first place – and contingency fees help you obtain these services without risking your personal finances.

Free Case Evaluation

All Fields Required

  • This field is for validation purposes and should be left unchanged.
Location Pin

Main Office

275 East Douglas Ave., #111
El Cajon, CA 92020
Location Pin

Chula Vista

823 Anchorage Place
Chula Vista, CA 91914