How Lawyers Get Paid for Personal Injury Representation

Published on Mar 5, 2020 at 12:47 pm in Legal Information.

Person signing documents

If you’re considering filing a personal injury claim, it’s likely you’re wondering how the process works—which includes how your attorney receives payment for their services. With most personal injury cases, attorneys operate on a contingency fee basis. In general, this implies the lawyer only gets paid if they successfully handle a case. Let’s take a closer look at contingency fees and how they could affect your claim.

Contingency Fee Basics

According to the American Bar Association (ABA), a contingency fee is a type of payment exchanged between an attorney and their client after a successful personal injury case. This type of payment is used in cases where the potential end result is a monetary award—from which the lawyer would get paid. If the case is not successful, the client does not owe the lawyer the fee. In addition to personal injury claims, like those involving auto accidents and premises liability, contingency fees are found in claims involving Fair Debt Collection Practices Act violations and harmful products.

With a contingency fee, the attorney and client agree to what percentage the lawyer will receive of the total compensation. The percentage depends on a variety of factors, including the complexity and risk involved in the case and the litigation costs.

In general, the more complex a case is the higher the contingency fee is going to be. In regard to litigation costs, you’ll have to know how court and filing fees, discovery costs, expert witnesses, obtaining evidence, and overhead and incidentals will be handled. Sometimes, these are included in the contingency fee, but you’ll want to be prepared if they’re not.

It’s important to understand the terms and conditions of a lawyer’s contract and payment prior to agreeing to anything or signing any documents. This way, you’ll have a complete understanding of how your lawyer’s fees will be taken care of in the event your case is successful.

Maryland Attorneys’ Rules of Professional Conduct

Every state allows for contingency fee agreements to take place in personal injury cases. As such, different states have different rules when it comes to establishing the fee. Under Maryland Code and Court Rule 19-301.5, contingency fees need to be in writing and signed by the client.

The contract must state how the fee is calculated, including what percentage fee will be charged at the different stages of litigation. In addition to that, the agreement must clearly state any expenses the client will be responsible for and whether or not those costs will be deducted before or after the contingency fee is calculated.

If a claim is successful, the lawyer has to provide the client with a written statement highlighting the outcome of the case, what the recovery is, how it was determined, and what portion the lawyer is to receive as payment.

Free Consultations with Belsky & Horowitz, LLC

If you have questions about a potential personal injury claim and what the process could look like for you, get in touch with our Baltimore law firm. We can evaluate your situation and give you an idea of what your next steps could be, should you decide to proceed with legal action.

Once we’ve given you an idea of your options, we can discuss payment and contracts, so you’ll have all the information you need to make an informed decision when it comes to choosing legal representation. To learn more, give us a call today.



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