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What is a Contingency Fee Agreement

If you pursue a personal injury claim, you will not have to pay your car accident lawyer unless you reach a settlement or obtain a trial judgment in your favor. A contingency fee agreement is used by almost all personal injury lawyers in Maryland.  

What is a contingency fee

A contingency fee is a fee that is only charged if the lawyer wins the case for you.  There will be an agreement in writing between a lawyer and a client in which the lawyer agrees to perform the legal service on the client’s case and take a percentage of the amount recovered rather than charging an hourly fee.  In other areas of law, such as family law or criminal law, the attorney bills at an hourly rate.

If your lawyer loses the case, you don’t owe him anything.  The law firm’s fee is contingent upon your recovery of damages by settlement or trial judgment for your legal claim.

Benefits to Contingency Fee Arrangements

When you hire your legal representative on a contingency fee basis, you can be confident that your attorney won’t charge you for every minute they spend on your personal injury lawsuit. Your lawyer’s fee will be based on the outcome of your case, not on how many hours they spend on your legal matter. Personal injury attorneys will take a percentage only if the case is resolved with a settlement offer or a judgment awarded in a trial verdict. The typical percentage that personal injury lawyers charge is 33 1/3%.

Contingency Fee Structure for your Legal Matter

 In addition to the contingency fee percentage, your lawyer will deduct the out-of-pocket costs associated with the litigation costs.

The agreed-upon contingency fee is calculated AFTER the lawyer has been reimbursed for their actual costs associated with the legal action.

Award for Damages Minus Out-of-Pocket Legal Costs is what the contingency fee rate is based on.

What types of Legal Bills will be Deducted

The process of pursuing a case can be very costly, as some expenses are unavoidable and others can be substantial. Personal injury cases can vary in complexity depending on the situation of the client, and fees and costs will depend on factors like the severity of injuries or the complexity of the case.

There are many different types of costs associated with a personal injury case. Costs are out-of-pocket expenses that your lawyer will need to pay for discovery costs as well as court filing fees.

Examples of potential out-of-pocket costs are:

  • Court Filing fees: if District Court: $46, if Circuit Court $185 (Note that Circuit Court is used if requesting more than a $30,000 award)
  • Deposition fees: an estimate of $1000 (deposition transcripts and time for court reporter)
  • Service of process fees: $50 per defendant
  • Various miscellaneous fees (copying, mailing, police report, medical records requests): approximately $200
  • Expert witness fees: Out of pocket costs will be substantially higher if expert witnesses are needed to testify

Legal costs vary depending on factors including the severity of injuries

The cost of a lawsuit varies based on the types of injuries and legal actions required.  In more serious cases, legal costs can total upwards of $15,000, while others can be as low as $200-$500. When deciding whether or not to file a lawsuit, keep in mind that you will need to repay your lawyer for the out-of-pocket costs incurred during the course of the suit.

It is important to have these discussions early-on with your lawyer.  Be sure you’re comfortable before continuing with your legal action.

Call Me for a Free Consultation – I’ll Answer Your Questions and Concerns

If you or a loved one was injured in a car accident in the Baltimore area, please contact me at the Law Office of John J. Leppler at (443) 955-1989 for a free consultation.

I will examine your case, advise you on your legal options, and assist you in determining the best course of action.  If you choose to work with me, I will fight the insurance company aggressively and will not back down by accepting a low-ball settlement. My commitment is to help you get the compensation you deserve!