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Basic Aspects of Contingency Fee Agreement

Most personal injury lawyers go along with the terms that have been stated in a contingency fee agreement. What are those terms?

No up-front fees

Some injury lawyers in Santa Paula ask their clients to pay an up-front fee, so that the lawyer feels ready to take-on the client’s case. Most personal lawyers do not ask their clients to pay such a fee. In fact, the fees’ cost gets absorbed, if the lawyer loses the client’s case. Of course, that does not mean that a personal injury lawyer never has to cover any added costs.

Indeed, the necessity to cover those costs could arise, as an lawyer pursues a client’s personal injury case. That lawyer’s out-of-pocket expenses might relate to the need to pay filing fees, costs associated with the preparation of documents or payments to expert witnesses. Normally, those costs get taken from the lawyer’s compensation.

So, how should that fact be addressed in the contingency fee agreement? That agreement should make it clear when the money gets taken from the lawyer’s contingency fee. Is it taken from the client’s entire reward, or is it taken from the money that is set aside as a contingency fee for the client’s lawyer?

The client agrees to hand over a percent of his or her reward/compensation.

The size of that percent should be stated in the contingency fee agreement. Typically, a lawyer will ask for 33% of the compensation given to the client. However, the lawyer’s percentage might increase, if the client’s case goes to trial. Any changes of that nature should be stated clearly in the contingency fee agreement.

If the lawyer loses the client’s case, then he or she does not receive any money. For that reason, a personal injury lawyer tends to be careful about the cases that he or she agrees to handle. A personal injury lawyer does not like to take a case that he or she does not feel confident about winning.

A possible problem that could arise

The insurance company sends the reward to the claimant’s lawyer. The lawyer takes-out the agreed-upon fee, and cuts a new check for the client. A smart client makes sure that the lawyer’s check gets written to the name that is on the client’s bank account. There are times when such a precaution should be taken, in order to make the client’s life easier.

It could be that the client and the lawyer are good friends. In that case, the lawyer might call the client/friend by a nickname. It would not be proper to have that nickname on the check. For that reason, it helps to take precautions, and to make sure that the lawyer knows the name on the client’s bank account.