What Is a Contingency Fee Agreement in a Personal Injury Case?
After an accident, many injured people worry about legal fees before they ever call a lawyer. Medical bills may be arriving, work may be missed, and an insurance company may already be asking questions.
A contingency fee agreement helps many personal injury clients seek legal help without paying hourly attorney fees upfront. Gavagan Law, LLC is a personal injury law firm in Dorchester representing injured people in Boston and throughout Massachusetts.
Quick Answer:
- A contingency fee agreement means the attorney fee is based on the outcome of the case.
- The client does not pay hourly attorney fees.
- The attorney fee is paid only if compensation is recovered, subject to the written agreement.
- The agreement should explain attorney fees, case expenses, litigation costs, and how funds are handled from the final settlement or judgment.
- Gavagan Law explains the fee agreement before representation begins so clients understand the payment structure.
Why Contingency Fee Agreements Matter After an Accident
After a car accident, fall, construction accident, medical malpractice injury, wrongful death case, or other personal injury case, accident victims may already be facing medical expenses, lost income, property damage, and insurance pressure.
A contingency fee agreement allows an injured person to hire a personal injury lawyer without paying hourly attorney fees or a large upfront retainer. Instead, the attorney fee is paid from the recovery if the case resolves through a settlement or judgment, according to the written fee agreement.
For example, a person injured in a car accident may suffer a rotator cuff tear, need shoulder surgery, miss work, and go through months of treatment while the case is being investigated or litigated. If the case later resolves for $100,000, the attorney fee is a percentage of that settlement. In many personal injury cases, that fee is one-third [33.33%] of the recovery, subject to the written fee agreement and any case expenses.
This type of fee arrangement helps injury victims access experienced legal representation while they are recovering and may not be in a position to pay thousands of dollars in upfront legal fees.
Gavagan Law represents injured people in Boston, Dorchester, and throughout Massachusetts on a contingency fee basis in personal injury cases.
How a Contingency Fee Agreement Works
A contingency fee means the attorney’s fee depends on the recovery. The lawyer is not billing the client by the hour. If the case has a successful outcome, the attorney’s fees are paid from the total recovery according to the written agreement.
If there is no recovery, there is no attorney fee, subject to the written fee agreement. The exact terms are controlled by the written contract between the lawyer and client.
Massachusetts Rule of Professional Conduct 1.5 addresses contingent fee agreements. With limited exceptions, a contingent fee agreement must be in writing and signed by both the lawyer and client, and the writing must explain how the fee and expenses are handled.
Attorney Fees, Case Expenses, Litigation Costs, Medical Liens
Attorney fees are not the same thing as case expenses. The attorney fee is the lawyer’s fee for their legal services. Case costs and litigation costs are expenses connected to the case.
Costs may include:
- court filing fees;
- medical records;
- police reports;
- expert witness fees;
- deposition costs;
- investigation expenses.
In complex personal injury cases, expenses can matter because medical records, expert witnesses, court filing fees, deposition costs, and other proof may be needed to properly build the claim.
An easy analogy is an auto mechanic repairing your car. There is a cost for the mechanic’s labor, and there’s also separate costs for the parts needed to complete the repair. A personal injury case can work in a similar way: the attorney fee and the case expenses are related, but they are not the same thing.
In addition to attorney fees and case expenses, some personal injury cases also involve medical liens. If Medicare, MassHealth, a private health insurer paid bills for accident-related treatment, they may claim a right to be repaid from the settlement or judgment. This is because part of a personal injury recovery includes compensation for medical bills.
Gavagan Law reviews these issues before settlement funds are disbursed, explains what is being paid and why, and, when appropriate, works to address or reduce medical liens.
Why This Can Help Injured Clients
The contingency fee model helps provide equal access to good legal representation. A person with a difficult financial situation can still pursue legal action against an at-fault driver, property owner, business, medical provider, or insurer and not worry about large retainer fees.
This payment arrangement also gives the lawyer a strong incentive to build a strong case because the attorney’s fee depends on the outcome of your case. The more the attorney can get for the client, the greater the attorney fee.
What Clients Should Ask Before Signing
Before an attorney-client relationship begins, ask:
- What is the attorney fee percentage?
- If my case goes into litigation or to trial, does the attorney fee increase?
- How are case expenses handled?
- What happens if there is no recovery?
A reputable attorney should explain the payment structure in plain English before the client signs.
