When hiring an attorney, how do contingency fees work?
Many people avoid retaining, or even speaking with, an attorney because their initial thought is that they cannot afford the services of a lawyer. Often, this is simply not the case. Many attorneys, especially those that practice in personal injury, understand their clients do not have the funds needed to pay upfront for the services they need. Therefore, instead of insisting their client pay in advance or as the case progresses, they agree to represent them on a contingency fee basis.
Contingency Fee Explained
A contingency fee means that the fee being charged is contingent upon some future event happening. When speaking of contingency fees in the legal realm, the fee is contingent upon the injured party receiving funds through a settlement or as an award of the court. Once this happens, the contingent part of the agreement has been fulfilled, and the attorney is able to collect their payment from the monies the injured party receives. How much the lawyer receives is determined by the Florida Rules of Professional Conduct as well as the agreement between the attorney and their client. On the other hand, if the contingency never happens and the injured party does not recover any compensation, the attorney receives no payment. The attorney will also be unable to recoup any money they spent in costs preparing the case.
Florida Contingency Fee Rules
The Florida Rules of Professional Conduct establishes certain rules that govern contingency fee agreements between attorneys and their clients. Some of these rules are:
- An attorney can charge up to 33⅓ % contingency fee of any recovery up to 1 million if the case settles before the answer or demand for appointment of arbitrators is filed (or if it settles before the time for the filing of these pleadings has expired)
- An attorney can charge up to 40% contingency fee of any recovery up to 1 million if the case settles after the answer or demand for appointment of arbitrators is filed (or if it settles after the time for the filing of these pleadings has expired)
- The contingency fee percentage will decrease if the settlement or verdict amount is for more than 1 million for any amount recovered in excess of the 1 million
- In addition to the contingency fee, an attorney may be entitled to recover for any costs they have expended on the case. Recovery for costs is a matter that should be addressed in the representation agreement.
Speak With An Experienced Florida Lawyer
If you have been injured or need representation in another legal matter, don’t just assume you cannot afford a skilled Florida lawyer. In many situations, the attorney may agree to take your case on a contingency fee basis which eliminates the need for you to pay anything upfront. Contact our office, Martin Law Firm, P.L., by calling 239-323-9820 or via our contact page to find out more about how we can help you.