Contingency Fees

The costs associated with recovering for an injury wrongfully caused by another can be substantial—more than most individuals can afford. That reality would make it impossible for most people who are injured to seek justice. To address this issue, most, if not all, New York City personal injury lawyers work on what is called a “contingency fee” basis.

What is a contingency fee?

A contingency fee is one that is only paid when a certain event occurs. When a lawyer works on a contingent basis in a personal injury case, you don’t pay the lawyer upfront or on an hourly basis for their services—payment is contingent on you recovering for your injuries. In such cases, your lawyer works in exchange for a percentage that will be deducted from the recovery after the lawyer deducts certain “fees and disbursements” from the recovery. The ordinary percentage is 33%, but it can be less, or the contingent can be on a sliding scale, as in something like: 50% of the first $10,000 recovered; 33% of the next $40,000; and 20% of everything over $50,000.

What are fees and disbursements?

Whether or not you recover for your injuries, there are certain items the lawyer pays for as the case proceeds. These fees and disbursements include amounts the lawyer may pay for expert witnesses, amounts advanced for medical exams, tests, or expenses, etc. If you recover, the amounts will be deducted from the recovery before the lawyer takes his percentage. If you don’t recover, your obligation to pay will be spelled out in the written retainer agreement the lawyer and you enter into.

What’s a retainer agreement?

Until you sign a retainer agreement, the lawyer does not work for you. A retainer agreement is the contract between you and your lawyer that specifies the ground rules of your relationship. The agreement will state what the lawyer is responsible for doing for you and what you are responsible for doing to aid the lawyer. It will also include the contingency fee arrangement you have with your lawyer, as well as the expenses that you will be responsible for paying, even if the lawyer advances those amounts for you while litigation is pending.

Will a lawyer take any personal injury case on a contingency fee basis?

No. Lawyers carefully evaluate any case before agreeing to take it on. This is particularly true when the lawyer will be doing so on a contingent basis because the lawyer will not get paid until after there is a recovery. If the lawyer does not think there is a reasonable chance of recovery, the lawyer will turn down the case. If the lawyer thinks the recovery will not be large enough to reimburse her work, the lawyer may well turn down the case. In addition, if the person who caused an injury has no means of paying a recovery (by insurance, savings or otherwise), a lawyer may not want to take on the case simply to obtain a judgment that cannot be paid.

What can a New York City personal injury lawyer do for me?

The time for filing a claim to recover damages for a personal injury can be extremely limited. Regardless of your situation or your age, an experienced personal injury lawyer can help you investigate the basis of your claim and ensure that your claim is filed in a timely manner, enabling you to eventually recover any and all damages that you have suffered as a result of the wrongful acts of another.

I think I have been injured by the wrongful conduct of another:

  • Seek medical attention immediately
  • Document your claims as thoroughly as possible
  • Your time to sue is limited; contact a personal injury lawyer ASAP

Changes may occur in this area of law. The information provided is brought to you as a public service with the help and assistance of volunteer legal editors, and is intended to help you better understand the law in general. It is not intended to be legal advice regarding your particular problem or to substitute for the advice of a lawyer.

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