As I explained in my first part of this series here, it is vitally important to hire an experienced personal injury attorney if you have been injured due to someone else’s fault. This recommendation, of course, begs a question: how do you pay for the services of your personal injury attorney?
Generally speaking, clients pay for their attorney’s services using one of three fee arrangements: flat fee, hourly fee, or contingency fee.
The vast majority of plaintiff’s personal injury attorneys use a contingency fee arrangement. This means that the attorney’s fee is contingent upon the amount of the client’s recovery, whether that recovery is because of a court judgment or a voluntary settlement. If the defendant or his/her insurance carrier is required to pay money, then under a contingent fee arrangement, the personal injury attorney’s fee for his services equals a percentage of that payment, no matter how much work he/she did or no matter how much time is spent on the matter. The percentage usually ranges from 33 1/3% to 40%. But if the defendant or his/her insurance carrier is not required to pay any money, then the personal injury attorney does not get any fee at all, no matter how much work he/she did.
The well informed personal injury client should also be aware that there is a difference between the personal injury attorney’s contingent fee and the costs of the representation. The attorney’s fee was just discussed above, but that amount does not include the costs of the representation, which are always the client’s responsibility to pay – even if there is no recovery in the case.
The costs of a personal injury representation typically include charges by other people involved in the case like the following: the client’s medical provider’s charges for obtaining copies of medical records; the court’s filing and service fees for the Complaint; court reporter’s charges for depositions; production costs for trial exhibits; and defense medical expert’s fees for depositions. A personal injury attorney can ethically agree to advance these costs to his/her client during the representation if the client is unable to pay, but the attorney cannot agree to enter into an agreement with his/her client to be ultimately responsible for these costs. To do so would constitute the attorney’s funding of the litigation and there is an ethical prohibition against doing that.
So, to sum up, in a hypothetical car accident case in which the plaintiff agrees to settle her claims against the negligent driver that caused her injuries for $100,000, a typical 1/3 contingent fee arrangement might produce the following payout: $33,333.33 to the attorney for his fee and $66,666.67 to the client, out of which the client would have to pay the attorney back for any costs advanced during the representation.
Jonathan T. Wren, the author of this article, is an experienced personal injury attorney in the Charlottesville, Virginia office of MartinWren, P.C., where he handles personal injury actions of all shapes and sizes as a member of the Virginia Personal Injury Lawyers group, including car collisions as a Charlottesville automobile accident lawyer. Jonathan also represents individuals injured by defective products, catastrophic injuries, and as a Charlottesville slip and fall lawyer. Jonathan is an active member of the Virginia Trial Lawyers Association, he has been named a Rising Star by Super Lawyer’s Magazine in personal injury litigation, and he currently chairs MartinWren, P.C.’s Charlottesville Personal Injury Lawyers practice group. If you have been injured in an accident, Jonathan offers free consultations and he would be happy to discuss your case with you. Feel free to call him at 434-817-3100.