Contingent Fee Agreement

Contingent Fee Agreement

A Contingent Fee Agreement is a type of contractual arrangement between a client and an attorney where the attorney’s fees are contingent upon the outcome of a legal case. In this agreement, the attorney agrees to represent the client without upfront payment, and instead, will receive a percentage of the monetary recovery obtained if the case is successful. If the client does not win the case or achieve a favorable settlement, the attorney does not receive any fees for their services.

This type of agreement is commonly used in personal injury cases, class action lawsuits, and other civil litigation where the client may not have the financial means to pay hourly legal fees. The percentage that the attorney receives can vary widely, typically ranging from 25% to 40% of the recovery amount, and this percentage is usually specified in the agreement before the case begins.

For example, if a client enters into a Contingent Fee Agreement with their attorney for a personal injury claim and the case results in a settlement of $100,000, and the agreed-upon fee is 30%, the attorney would receive $30,000, while the client would keep the remaining $70,000. However, if the case does not result in any recovery, the client would not owe the attorney any fees.

It is important for clients to carefully review the terms of a Contingent Fee Agreement, as it typically outlines not only the percentage but also any additional costs or expenses that may be incurred during the legal process, which the client may still be responsible for regardless of the case outcome.