About Contingent Fees

by Gerald McGill, Esquire

All personal injury lawyers accept serious injury and death cases on a contingent fee basis. This means that if the lawyer does not make a recovery for you, there is no fee charged.

All of our lawyers participate on the basis that if there is no recovery, there are no fees or costs owed.

A contingency fee is based on the percentage of the total recovery in the case, plus an additional recovery of the costs expended. Costs generally means the expenses of hiring experts, court filing fees, deposition fees, costs for obtaining medical records, and all other things necessary to accumulate the evidence for the trial. Costs generally are recovered at the conclusion of the case. They may be either deducted after the contingency fee percentage has been taken from the total recovery or subtracted from the total recovery before the contingency fee amount is calculated. This generally is a matter of negotiation and can make a significant difference as costs can be very high in product liability cases.

Generally, most lawyers and law firms will tell you that their contingency fee is one third (33 1/3%) of the total recovery if the case is settled before a suit is filed. The contingency fee goes up to 40% as soon as the case is filed. Many firms also charge an additional fee in the event of an appeal which may make the total fee be as much as 45 to 50 percent of the total recovery.

Certain states such as Florida, for example, provide a sliding scale for attorneys’ fees which is geared to the amount of the recovery. These amounts are the maximum fees which may be charged without permission of the trial judge to charge a greater fee.

  • 33 1/3% of any recovery up to $1 million through the time of filing of an Answer or demand for appointment of arbitrators or if liability is admitted at the time an Answer is filed
  • 40% of any recovery up to $1 million through the trial of the case
  • 30% of any recovery between $1 – 2 million unless liability is admitted at time an Answer is filed in which case 20% of such recovery
  • 20% of any recovery in excess of $2 million unless liability is admitted at time an Answer is filed in which case 15% of such recovery
  • 5% of any recovery in addition to the fee schedule above if an appeal is necessary

However, many states do not have any sliding scale based upon the total recovery and consider the amount of attorneys’ fees to be a matter of contract and negotiation between the client and the attorney.

Despite what has been said about the general percentages charged, there is no requirement that any set percentage must be charged. In fact, just the opposite is true. Clients should be told in advance that the contingency fees are negotiable and that the client has the right to talk with the lawyer about the proposed fee and to bargin about the percentage as in any other contract.

When asked, some lawyers may refuse to charge less than their stated contingent fee percentages. If this is the case, then a potential client has only two choices: either accept the quoted fee or retain another lawyer or firm.

The bottom line, however, in looking at the question of percentages of contingent fees is really what amount of money the plaintiffs put in their pocket when their case is concluded. Obviously, a lawyer who charges a larger contingent fee but recovers amuch larger recovery benefits his client as well as himself. For example, if a lawyer charged a 40% contingency fee and recovered one million dollars, the client would receive $600,000, minus costs once deducted. However if another firm could only obtain a $500,000 recovery, and charged a 25% contingent fee, the client would then receive only $375,000. Therefore the ability and expertise of the firm handling the case must be taken into account in order to maximize the plaintiff’s recovery.
The hiring of a lawyer is an important decision that should not be based solely upon advertisements. Before you decide, ask us to send you free written information about our qualifications and experience.