What are Contingency Fees and Why are They Important?
Written by Cooper & Friedman PLLC on February 13, 2017
Dozens of movies and television shows involve court cases or meetings with lawyers. While these dramas tend to be entertaining, most people never really think about the logistics involved in hiring an attorney until they are in a situation where they need one.
A great way to get informed and unbiased legal advice is to hire a lawyer. Hiring a lawyer is also a way to help defend your legal rights, but what else does it entail? Additionally, when does a lawyer get paid after a case is settled or won and how do they get their payment? Understanding the financial details involved in hiring an attorney is important.
Depending on the type of legal case at hand, there are various fees lawyers may charge. These include: consultation fees, contingency fees, flat fees, hourly rates, referral fees, retainer fees and statutory fees. And to make matters even more confusing, different law firms have different fees and different approaches towards billing.
As a personal injury law firm serving people in Kentucky and Southern, Indiana, the personal injury attorneys at Cooper and Friedman offer free initial consultations with an attorney. Additional billing is based on a contingency fee. Contingency fees are sums of money that an attorney receives when a case is successfully settled or won.
Generally the contingency fee is a percentage of the settlement that the lawyer is entitled to when a client receives monetary compensation for his or her case. In short, if a lawyer is unsuccessful in the case, the client will not have to pay any fees. When a lawyer wins or settles a case for their client then they’re entitled to a percentage of the earnings. This type of fee system is common in the area of personal injury cases.
Understanding Contingency Fees – Additional Details to Know
Oftentimes, jurisdictions establish a cap for the amount received in a contingency agreement. Some lawyers believe in capping the fees at one-third, while others differ on the subject. There is also some legislation that limits the cap fees causing lawyers to receive less than their mandated contingency fees. For instance, workers’ compensation fees are capped, so clients have very little to lose and a lot to gain.
While contingency fees pay for a lawyer’s services, they don’t cover additional legal fees that sometimes come with a case. This includes things like: filing costs, copying costs, expert witness fees, etc. If you are looking to hire a personal injury attorney, it is important for you to understand the details involved in a contingency fee based payment model. And it’s always advisable to ask the firm about any additional financial responsibilities involved.
Legal cases can become very confusing and stressful, so before you hire a lawyer, it helps to have a clear understanding of the billing process the firm uses to charge for legal assistance. The initial consultation fee is free and is handled by a qualified attorney at Cooper & Friedman. For more information, or to receive your own free case consultation with Cooper & Friedman, call 502-459-7555 now.