5 Things You Need to Understand About Lawyer Fees
When you’ve been wrongfully injured in an accident and are considering taking legal action, it’s important to be aware of how lawyer fees work. There are different types of agreements, fees, and costs that could impact how much compensation you receive when your case settles. This blog will provide you with standard information about the fees you could face when hiring a legal representative. It’s important to note that fees and expenses vary depending on the law firm you choose and your unique circumstances.
1) There are different types of legal fees.
The type of fee arrangement you make with an attorney will have an impact on how much you end up paying for their services. There are a number of factors that impact the fees, including the amount of time spent on your case, the lawyer’s experience and reputation, and results, and the overhead expenses. The common type of legal fees include:
- Consultation Fees. Some lawyers charge a fixed or hourly fee for your initial meeting. At Shrager & Sachs, however, we provide free initial consultations for our personal injury clients.
- Contingency Fees. If you lose a case with a contingency fee, the lawyer does not get a fee. Sometimes, you still have to pay expenses. The percentage of the fee varies depending on the law firm and litigation area.
- Hourly Rate. This is the most typical fee arrangement. For every hour or portion of an hour that the attorney works on your case, you’ll be charged. Fee scales could differ depending on the case and the lawyer’s experience.
- Flat Fees. Flat fees are typically only offered if the case is relatively simple, like a will or uncontested divorce. The lawyer will charge a specific, total fee.
- Retainer Fees. A retainer fee is like a down payment against future costs and expenses. You may pay a set fee based on the hourly rate. Retainer fees mean different things depending on the law firm you’re working with and the circumstances of your case, so it’s important to understand everything that’s involved before you agree to provide one. They are typically nonrefundable.
- Referral Fees. If a lawyer refers to you a different attorney, they can ask for a portion of the total fee you pay for the case.
- Statutory Fees. These fees are most common in probate and bankruptcy.
2) Most personal injury cases are offered on a contingency fee basis.
As mentioned above, contingency fees are based on a percentage of your compensation. Average contingency fees range between 33 and 40 percent, but negotiations or alternative agreements may be an option. In the majority of cases, however, your attorney receive a percentage of your settlement. If, for example, the contingency fee is 33 percent and you are awarded a total settlement of $30,000, your lawyer will receive $10,000.
Some lawyers will draw up a fee agreement where the contingency fee varies depending on when the case is resolved. This is referred to as a sliding scale. For example, if your case settles prior to going to trial, the contingency fee may be lower than if you have to go to court.
3) There are costs and expenses that impact your final compensation.
There may be additional costs and expenses deducted from your award. These are the expenses paid by your lawyer’s office while investigating your injury claim, conducting settlement negotiations, or pursuing a lawsuit. Common costs and expenses include medical records, expert witness fees, postage, filing fees, depositions, and trial exhibits. So if after the contingency fee you’re left with $20,000, like in the example above, the additional costs will be deducted from that.
There are ways to manage the costs and expenses in a personal injury case. For one, it’s important to get your fee and expenses agreement in writing. The agreement should address how costs will be handled throughout your time working with the law firm.
4) Your lawyer will receive the settlement check.
In most cases, the settlement check will be sent to your lawyer. This is to ensure that the attorney gets paid for their services. When they receive the settlement check, you’ll be contacted. You should receive an itemized list of deductions to cover fees, costs, and expenses. If you feel as though there are charges on the list that do not belong, you have the option of disputing the costs. Often times, the disputed amount will be placed in a trust account until the matter is resolved.
5) You can seek guidance from another lawyer if you have concerns.
Disagreements over expenses are one of the most common sources of tension between personal injury lawyers and their clients. When fee disputes arise or you think your lawyer participated in unethical behavior, you can work with a different law firm to resolve the matter.
The most common issues where plaintiffs can get their money back involve retainer fees and when tendered full payment for legal services has already been rendered. Examples of unethical behavior include lying, failing to provide known information, revealing confidential information, and treating retainer payments as personal funds.
We understand that legal fees can be confusing. Prior to signing any agreements, we’ll answer any questions you may have and make sure you feel entirely comfortable with the fees attached to our services. For more information, contact us today.