Personal Injury Law: 3 Terms And Conditions To Be Aware Of In Your Contingency Agreement

Agreeing to pay a contingency fee rather than an hourly rate to your personal injury attorney may be a good idea. With a contingency fee agreement, you won't be out a single penny even if you lose your case; however, do keep in mind that contingency fees can be rather hefty, as most personal injury lawyers will charge a standard 33% rate. This means that your attorney will be entitled to 33% of the total amount of compensation that is awarded. More often than not, this amount will work out to be far greater than the attorney's hourly rate. Still, if you're not too confident in your case, and you don't know how long it will drag on, opting to pay a contingency fee is generally the better option. When reviewing the contingency agreement, take a look for these three terms and conditions.

Statement Outlining How The Fee Is Calculated and Collected for Both Lump Sum Settlements and Structured Settlements

Most personal injury cases do not make their way to court, and will be settled pre-trial. Depending on the amount of settlement you agree to, you may wish to opt for a structured settlement, where the compensation is paid out at different annual or monthly intervals, rather than a lump sum payment. Regardless of how you wish to be paid, make sure that the contingency fee agreement clearly states how the fee will be calculated and collected. To make sure that there are no misunderstandings due to the language used in the agreement, there should always be a simple example included that shows exactly how the contingency fee is calculated. Take a look at the different charges and determine whether they are reasonable. Most attorneys will be open to negotiations.

If you opt for a structured settlement rather than a lump sum payment, you may request a larger amount to be paid initially in order to pay off your attorney. Some personal injury attorneys are willing to set up payment plans with their clients. In which case, you may just pay the attorney a certain amount each month until all of your legal expenses are paid off. 

The Manner of Which Disbursements and Taxes will be Collected

Most personal injury cases are a lot more expensive than you'd imagine since there are additional fees other than lawyer fees that need to be paid. If you require witness testimony, you should expect to pay the expert approximately $386 per hour of for in-court testimony. This doesn't include the cost of getting an expert to review your case or prepare a strong stance to support your claims in court. Your lawyer fees may not include the cost of expert testimony and other expenses. Within the contingency fee agreement, you should find statements clearly outlining the party that will be responsible for these disbursements and how and when the fees are to be paid. If your attorney fronted the funds upfront, the contingency fee agreement will provide more details as to how you will reimburse them. Make sure you are not charged interest.

Keep in mind that you may also have to pay taxes on the compensation you recover. The contingency fee agreement will also give you further details as to what to expect.

Clear Description Regarding How a Contingency Fee Agreement May be Terminated

A contingency fee agreement is not necessarily binding, and clients should be able to terminate the agreement should they decide not to pursue the case or decide to go with a different lawyer. Read through the terms and conditions of the contingency fee agreement to determine whether there are any provisions included that would make terminating the contingency fee agreement difficult. You should not need the lawyer's consent to terminate the agreement.

The contingency fee agreement should clearly state how either you or the lawyer can terminate the contingency fee agreement, the consequences involved for terminating the contract and how the lawyer's fee will be calculated or determined should the agreement be terminated prematurely. 


As you are bound to the terms and conditions listed in the contingency fee agreement, make sure you take the time to scrutinize every provision or statement. If there is anything that you don't fully understand, you should definitely bring it up with your attorney before signing the agreement. The contingency fee agreement should basically outline all of your responsibilities in the case, and what you should expect from the attorney.

For more information, contact a company like Whiting, Hagg, Hagg, Dorsey & Hagg