Contingency Fees

Simply stated, this is where an attorney gets paid a percentage of a recovery. If there is no recovery, then there is no fee payment. That is, the attorney may work for hundreds of hours and not get paid. In California, just about any case can legally have a contingency fee except for divorces and criminal matters.

Typically, contingency fees are about 25% to 40%, but can range up to 50% if the matter is pursued to a complex trial and an appeal. Some laws or judicial practices put a cap on contingency fees. For example, most courts limit contingency fees to a 25% fee for a personal injury settlement for minors. There is also a cap regarding lawsuits against physicians. The obvious reason for that is to deter medical malpractice suits. Workers’ Comp is typically is 10% to 15% of the permanent disability award. Mind you, these reflect contingency fees common in California. Other states may vary.

Again, there is the matter of expenses or costs. Depending on the case, the client alone may pay the costs or the attorney and client may share the payment of costs upon recovery. What determines the pro rata sharing of the costs is the nature of the case.

A survey of lawyers who took contingency cases found that on the average they only accepted 46% of those presented to them. The lawyers with the most selective criteria accepted only 10%. Even those with the least selective criteria, accepted only 52%. So, don’t take it personally if a lawyer refuses to take your case on a contingency basis. I estimate that I accept about 20% of the contingency cases that come my way.