What is a Contingency Fee Agreement?

At Shulman DuBois, we take most of our cases on a contingency fee basis. Many potential clients ask what this means, and how they benefit.

Thousands of Oregon residents are injured every year in car collisions, accidents at work or school, or when cycling down a city street or crossing a busy intersection. In an outstandingly large number of these cases, grounds exist for making a personal injury claim. Yet many people take the hazardous route of dealing with the insurance companies themselves, because they feel they cannot afford the costs of hiring a lawyer to represent them, and the costs associated with going to court. For these people, a contingency fee agreement can be the answer to their prayers – no money up front is required.

Contingency Fee Agreement Means: No Win, No Fees

Like a lot of legal jargon, people can be nervous when they see the words “fee” and “agreement” in the same phrase. The old expression that the only people to really win when a case goes to court are the lawyers is never far from the back of the mind. But times have changed, and with the advent of contingency fee agreements, that old expression no longer has merit.

What is a contingency fee agreement?

To put it in the simplest terms possible, a contingency fee agreement means if the lawyer takes your case and doesn’t win, it costs you nothing. The result must go in your favor, and only then does your lawyer receive a fee. It doesn’t matter how complicated the case or how long it takes to get a judgment. Nothing is due to your lawyer unless and until you win your case. Your award may be won in or outside of court, if the other party offers a settlement before the case goes before a judge and/or jury, but in any event, having an excellent personal injury attorney needn’t cost you a penny.

How do the lawyers make their money with a contingency fee agreement?

The lawyers get paid when you get paid. The contingency fee agreement will stipulate an amount the lawyer is to be paid once your case has been won. The fee is invariably based on a percentage of your reward, but you will be fully aware of the lawyer’s share at all times, and once the agreement has been made, no additional costs, fees or expenses can be charged to you. Not ever.

In addition, rules are in place which mean the lawyers can only charge a “reasonable” fee in terms of the percentage of your reward they take for themselves. Those rules vary from place to place and are based on the “ethical rules of professional conduct. In all events, a clear and precise statement of what’s to be paid after a successful claim will be stipulated within the contingency agreement.

The pros and the cons of contingency fee agreements

The clients have very little to lose with a contingency fee agreement. If an attorney elects to take on their case, it will cost them nothing if the attorney loses, and only a pre-agreed amount if they win, with no surprises. People who could never normally afford to embark on a legal process can have their day in court without fear of the expense involved. If the worst happens, and their case is lost, while they won’t receive any award, they also will receive no bills from the courts, or from their lawyers.

The fact that their lawyer will only get paid if and win they win an award for their client means the lawyer has a strong, vested interest not only in winning the case, but in getting it done quickly. Finally, because attorneys will only take cases they think will succeed, it keeps a large number of unrealistic or frivolous cases out of court.

The same reasons contingency fee agreements are good for the plaintiff are the very same reasons some lawyers may refuse to accept a case. Because of the risks involved for the attorney’s firm, they can and do turn some potential actions away. If a client’s case isn’t strong enough, the lawyer will not be willing to invest considerable time, not to mention money, pursuing an action that may ultimately prove fruitless.

No Money is Required Up Front with a Contingency Fee Agreement

In some cases, the attorney may conduct an initial investigation, without charging the client for doing so. If after that investigation the lawyer feels the chances of success are too slim, he is still within his rights to refuse to take the case further.

Contingency fee agreements are of major benefit to people who would otherwise not have access to the courts. They give people who have been injured through someone else’s negligence a chance to recover their medical expenses, and to be compensated for their pain, suffering and loss of income, but without the risk of large legal fees in the event their claim fails. So the best advice for anyone who is considering making such a claim is to contact a reputable Portland personal injury attorney for a free consultation.