Advantages of contingent fees in injury cases

Gerry McGill — Wed, 24 Jun 2009 16:19:39 GMT

One of the true advantages to the plaintiff is that a contingent fee contract is a no-risk proposition for the plaintiff in that if no recovery is made they owe no fees and in most cases no costs to their attorneys. In addition, a contingent fee contract has often been described as the keys to the courthouse. In reality, only the most wealthy of plaintiffs could afford to pay a plaintiff's attorney an hourly rate plus advance all costs to be expended in a case against a major corporation.

Another advantage of the contingent fee contract is that in cases where the injuries or damages are significant enough, very competent and reputable attorneys are willing to invest the time and money necessary to do a free evaluation of the case for their potential clients. Since most contingent fee attorneys will only proceed with a case they feel has merit, they should make the evaluation as timely as possible and in the event that they do not feel that they could represent the client they should inform the client of that fact in sufficient time that the client would have time to consult with another attorney or law firm. It is not uncommon that a case is turned down by one attorney or law firm and accepted and successfully handled by another firm.

Finally, one of the major advantages to plaintiffs is that the contingent fee system encourages the plaintiff's attorneys to be efficient and to resolve the case as soon as possible. Since the attorney does not receive any fee nor any reimbursement of what may be significant costs advanced until the case is successfully concluded, the contingent fee encourages the attorney to work to settle the case as soon as possible. In contrast, most defense attorneys for large corporations and insurance companies are paid on an hourly basis. Obviously, there is no great incentive for these attorneys to conclude the case in an expeditious manner and hourly fee arrangements can encourage delay, inefficiency and unnecessary legal tactics.

Originally posted at InjuryBoard by Gerry McGill

How to hire an injury lawyer in Mississippi

Gerry McGill — Fri, 19 Jun 2009 12:00:00 GMT

I have written in an earlier blog that virtually all lawyers handle injury and death cases on a contingent fee basis which means that the fee charged is a percentage of the client's recovery. Although some lawyers charge 1/3, most ask for 40%. However, in Mississippi lawyers can charge as much as 50%! Fees in Mississippi are regulated by Rule 1.5 of the Mississippi Rules of Professional Conduct.Mississippi Rules of Professional Conduct. Rule 1.5(a) provides that: "A lawyer's fee shall be reasonable" and then lists eight factors to be considered in determining the reasonableness of a fee.

Rule 1.5(c) provides in part that: "A contingent fee agreement shall be in writing and shall state the method by which the fee is to be determined, including the percentage or percentages that shall accrue to the lawyer in the event of settlement, trial or appeal, litigation and other expenses to be deducted from the recovery, and whether such expenses are to be deducted before or after the contingent fee is calculated."

Unfortunately, nowhere in the Rules is any requirement that a lawyer tell a prospective client that both contingent fee percentages and whether expenses are deducted before or after the contingent fee is calculated are negotiable.

Let's take a worst case example for the client. You hire a lawyer in a serious case and agree to a 50% attorney fee with the costs to be deducted after the contingent fee is calculated. Over the course of the case the lawyer advances $50,000.00 in costs for depositions, expert witness fees, and medical expert fees. If the case is settled or there is a jury verdict for $250,000.00, the lawyer takes $125,000.00 as his fee leaving the client with a gross recovery of $125,000.00. However the lawyer then recovers his $50,000.00 in costs leaving the client with a net recovery of $75,000.00. Most lawyers would not do this, but the Rule allows this.

Let's take a more likely example using the same settlement figure and costs. In this case the lawyer charges a 40% fee with costs to be deducted before the contingent fee is calculated. When the $50,000.00 costs are deducted from the total recovery of $250,000.00 there is a gross recovery of $200,000.00. Now the 40% attorney fee is $80,000.00 and the client's recovery is $120,000.00.

What's the moral of this story? Be sure you discuss the terms of any contingent fee with the attorney before signing any contract. In fact, if you have been seriously injured due to someone else's negligence, you should probably talk with several attorneys before deciding which one should handle your case.

Originally posted at InjuryBoard by Gerry McGill

Biloxi / Gulfport Personal Injury Lawyer - Attorney Fees

Advantages of contingent fees in injury cases

How to hire an injury lawyer in Mississippi