How Do Contingency Fees Work in a Car Accident?
A contingent fee contract is one where the lawyer agrees to represent the client for a percentage of the client’s financial recovery. The attorney fee is “contingent” upon the amount of money awarded in the case.
As Tampa auto accident and personal injury attorneys, we recognize that the mere idea of paying a lawyer’s fees plays a major role in a person’s decision to seek legal help. This is especially true in hard economic times when money is better spent living than hiring an attorney. When a victim of serious personal injury has a hard time making ends meet and is barely getting by—they still need the highest quality legal help and deserve fair compensation.
How Can I Pay for an Attorney After a Car Accident?
You can either pay an attorney by the hour or a contingency fee. However, paying for an attorney upfront is expensive ($500 per hour) and paying an attorney by the hour also creates some situations where (like I like to say) there is “attorney motivated obstruction” in resolving the case.
What Is The Purpose of a Contingency Fee?
Most injury lawyers that are established, financially secure or in a big enough firm, will front the costs on the injured party’s behalf and then deduct them once they collect for the client.
The contingency fee arrangement allows for this to happen. There is no up-front payment. If the attorney is not able to win a recovery for you, you do not pay any legal fees at all. This arrangement makes it possible for every person, every family—no matter how financially distressed they may be—to have access to good personal injury attorneys
Call or Text Your Tampa Personal Injury Attorney at 813-755-9500
What Are the Benefits of Hiring an Injury Attorney on Contingency Fee Versus an Hourly Rate?
Retaining or hiring a Tampa injury attorney on a contingency fee basis (where your lawyer gets a percentage of the settlement) can be more rewarding for the client and for the injury attorney because we have a common goal:
seek the biggest recovery for the client’s case and as fast as possible.
Moreover, if the client does not make a monetary recovery (i.e., collect money) then neither does the Tampa injury attorney hired for the case. In other words, the client owes us nothing. It’s that simple, no fees unless we win and collect. On the other hand, hiring a Tampa injury attorney on an hourly basis rewards inefficiency, creates delays and commonly creates negative issues between the lawyer and the client (that is what insurance defense lawyers do).
What Percentage Should a Contingency Fee Be?
The Florida Supreme Court and the Florida Bar orders how contingency fees work in personal injury cases. The statute is complex and the percentage of contingency will vary. A very basic synopsis is as follows:
Before Filing an Answer:
For a personal injury case that settles before the defendant answers a lawsuit complaint:
A fee cap of 33⅓% (one-third) is placed on a settlement of up to $1 million;
For settlements that exceed $1 million the cap is incrementally reduced by 10%;
The defendant has a window of 20 days to answer the complaint.
After Filing an Answer:
If the defendant answers the lawsuit complaint within the 20 days, or if the case goes to trial and the injured party succeeds in getting a judgment, the cap changes:
The plaintiff’s attorney may accept 40% of the contingent fee up to $1 million;
If the settlement amount or judgment is more than $1 million, the percentage amount paid to the lawyer is reduced in percentage increments as set forth by the Florida Supreme Court.
If you have suffered a serious personal injury, or the wrongful death of a family member, contact Martin Hernandez, PA to have your case reviewed at no cost by our seasoned lawyers. There is nothing to risk, and much to be gained by talking with us.
What are the advantages of paying a lawyer only when the lawyer collects?
Hiring a lawyer and only paying the lawyer when the lawyer collects (also known as a ‘contingency fee’) has advantages for the consumer client. There are at least four advantages of contingency fees.
- The contingent fee is the one device in law that gives injured people of limited financial resources a chance to hire a lawyer and fight giant corporations and insurance companies. Few people after a car accident can afford to pay an experienced lawyer $500 per hour or more for a couple of years of challenging litigation. This levels the playing field against those companies.
- Contingent fees give the attorney the incentive to seek the highest recovery in your case, move the case as fast as possible, and successfully collect on your claim. A lawyer who knows he will not be paid unless his client is successful is highly motivated to get the optimal result for the client. By contrast, an hourly fee arrangement can encourage delay, inefficiency, and unnecessary action unless there is an incentive to earn future business from the same client.
- Contingent fees weed out cases that lack substantial merit. Experienced attorneys will not waste their time on a lawsuit that does not have enough merit to justify an investment of their time. We take a calculated risk. However, any lawyer who repeatedly bets on cases that have no value may soon go broke.
- Expenses of litigation, as well as fees, can be prohibitively high for injury victims. Lawyers who work for contingent fees typically also advance the expenses of litigation (filing fees, accident reconstruction, expert witnesses, court reporters, videographers, medical illustrations, exhibit preparation, travel costs, etc.), knowing that most clients are unable to do so, and are reimbursed for the costs out of money recovered for the client. Experienced in the rough estimation of costs and benefits, and knowing they will get that money back only if they win for the client, sensible lawyers are motivated to be prudent and spend only as much as necessary.
See why experience and results matter.
Call or Text Your Tampa Personal Injury Attorney at 813-755-9500
