The contingency fee or “No fee unless you win” allows many people who otherwise couldn’t do so obtain access to legal services. In the many years our Idaho personal injury attorneys have represented injured people, few clients have wanted us to work on hourly fee instead of a contingency fee at the outset of a case.
No Fee Unless You Win Lawyering
The contingency fee provides the opportunity for many people to get the services of a respected attorney. It is regularly used in personal injury and wrongful death cases in Idaho. It is a hallmark of the legal system in the United States.
What is A Contingency Fee?
Under a contingent fee agreement, the trial lawyer is paid a percentage of the amount recovered for the client. If a case goes poorly or problems arise, the lawyer does not get paid. Potential clients who evaluate the option of paying an attorney by the hour or a percentage almost always choose the contingent fee option. This is true even when an hourly rate would end up being cheaper.
What Are The Benefits To A Contingent Fee For the Client?
The first benefit is that a client does not have to incur any out-of-pocket expense for attorneys fees. This is what allows a client to obtain a leading attorney when the client does not have the means to pay. A contingent-fee also benefits the client by effectively spreading the risk of litigation. The client assumes all of the risk in a case where the client is paying by the hour. However, in a contingent-fee arrangement, the attorney shares that risk. He only gets paid if he wins a recovery. This system ensures that the attorney does the work needed to obtain a favorable outcome. It makes the lawyer and client, in a sense, business partners. Few injured people are wealthy enough to afford the hourly rates that corporations pay their lawyers. Contingency fees provide access to justice for ordinary people of average and limited means. In the real world it is people from ordinary walks of life who deal with injury claims.
Clients Like Contingency Fees
When they think about it clients appreciate that we take the risk of not getting paid. The members of our firm are glad to have the ability to do so and help people in need. The contingency fee arrangement has many benefits for both the client and the attorney. Without paying a penny, the client gets quality legal representation from day one. Basically, clients get the chance to eliminate all risk of having to pay for the cost of legal services unless the case itself provides them the money to do so.
Clients are universally happy to have an attorney take the financial risks at the start– at a time when any case may turn out to offer no, or limited, recovery. Our business model allows us to take on the risk of no recovery in a case. To, in essence, wager that with our specialized skill, the reputation we have earned, and our ability to successfully pursue and litigate a case we can obtain the fairest compensation available for our injured clients. And earn our fee.
Contingency Fees Are About Risk and Accessibility
Of course, there are those cases where we have invested many hours of time and expenses to develop and pursue the case and not obtained the results we wanted. In those cases, the business model can hurt. Those cases where we have stayed up late and worked weekends preparing for trial only to have the jury disagree with our arguments are part of the contingency fee system. And it is not just the investment of our time that is at risk. In addition to the fee, the lawyer will get repaid for the out of pocket expenses they have incurred in prosecuting the case on behalf of the client. These costs can be quire high, in for example medical malpractice or products liability cases. As experienced contingency fee lawyers we know that clients as a general rule do not repay the expenses we have incurred in cases that end poorly. They get written off as bad debts most of the time.
Insurance companies easily bear the costs of litigation. The average injured person cannot . Clients are right to shift the risk of such a loss to their lawyers.
Personal Injury Cases Take Work to Resolve
One reason the contingency fee makes sense is that even cases which at first glance seem simple, often take substantial work. Clients frequently perceive things as clear cut. This is as their lawyer attends depositions, works with witnesses and medical professionals, participates in hearings, fights over evidence and otherwise engages in the general legal wrangling. In even the most basic cases, our lawyers regularly go to depositions or court hearings.
Defendants frequently fight among themselves as to who has what share of liability or drag out proceedings just to try and get leverage over clients. And the insurance companies keep the client’s money in their accounts until the last possible moment just before trial. They want to be sure that the case is prepared to go forward. At the outset, when a client has to choose to pay hourly or contingency it is extremely difficult to gauge whether the case will settle easily and or require years of work. Undoubtedly, with the benefit of hindsight, some cases turn out to be profitable and some do not. Separating profitable cases from ones that will be a long slog and financial drains is not an easy task. There are many unknowns at the moment the attorney client relationship is formed. Those armchair critics who claim it is simple who have not faced the reality of representing injured people.
Access to Justice Is Increased By The Contingent Fee System
Because it reduces the clients risks ahead of time, the contingency fee system makes sense for clients. This is true even if at the end it may not be immediately perceivable as “fair” based solely on time investment. One has to ignore both the risk shifting and the impact of having a quality plaintiff’s lawyers working the case to have that view. It is false to equate the amount of time a lawyer spends on a case with “value” for the client.
Injury clients did not seek that role– they did not ask to be injured. They cannot prepare for the role of claimant by having on hand a staff of experienced attorneys, developed experts and medical specialists. The corporate defendants and insurance companies have those folks at their beck and call. And clients should not have to bet their homes and savings that they will win their cases. That is what they would need to do to recover the hourly legal fees they would be required to pay without a contingency agreement.
Everyone, no matter their walk of life should have access to quality, motivated, experienced counsel. That is what the contingency fee provides.
Sometimes Issues Arise About A Contingent Fee
It is at the late stage of a case that sometimes clients wonder why the attorney gets the fee. After the work we have done that gets us all to a point of resolution. It often only happens after months and years of work having been done. But in those cases that seemed to them to go easily some clients forget the risk that we lawyers agreed to incur at the start. Sometimes clients lose sight of, or just do not understand, the value that our reputation and efforts in prior cases have brought to their case.
Good Lawyers Treat Contingency Fee Clients Fairly
We do not take contingency fees from clients who come to us with a full fair offer from an insurance company or a policy limits offer based on limited coverage. We often help these folks and others handle their cases on their own with some advice and guidance, It is only where we believe we can provide value to a client that we take on that client.
Some misconceptions can lead clients at the end of a case to want to change the agreement. Its when the risk has passed they want to convert us to hourly fee lawyers. This is understandable. Even if that is exactly what they did not want to do at the start of the case. This usually happens when they perceive the amount of time we worked on the case doesn’t justify our fee.
But it is our work, reputation, and efforts that helps create risk exposure. That risk is what leads an insurance company to pay a fair settlement under the circumstances at hand. We are happy to take the fee. And believe it is fully earned. We are always proud to have done the work to get the best possible result for a client. That is true no matter how many hours we work on the case.
The amount of hours is not the same thing as the value our skills brought to bear. And the contingency fee is what allows every person to access those skills when a lawyer is needed.