Contigency Fees are Good For the Injured
Contingency fees have gotten a devilish rap ever since tort reform came into the spotlight. The truth about these fees is that they are vital to our legal system. Media outlets consistently fail to acknowledge the value of such fee arrangements. The news focuses only upon the seemingly high fee that an attorney has collected rather than the benefits and purposes that contingent fees serve. Without these fees, many injured people would never be able to afford the legal help they need in order to recover what they are justly owed. Just recently an Oklahoma newspaper included an article entitled “Fee lunch: Trial lawyers dine on others awards”. This article is one of many press releases that highlights a nationwide misconception regarding contingency fees and in turn, wrongfully fuels the fire of tort reform.
A contingency fee means the attorney receives a designated percentage of the settlement or trial award. Thus, if a client receives no compensation for damages, then the attorney receives nothing either because the fee is “contingent” upon recovery. Whereas if the attorney was to be paid on an hourly basis then the client would face several obstacles:
- The client may have to pay a retainer fee in order to hire an attorney,
- The client would have to pay the attorney’s fees even if there was no recovery and
- The client would most likely have trouble paying hourly fees as they came due.
Generally, the industry standard for contingency cases is 33%, yet can it can be raised depending upon the complexity of the case. The contingency fee serves as a legal device that allows middle class and low income persons to pursue their claims against large corporations and insurance companies. Each state has different regulations and caps on contingency fees. When attorneys take cases on a contingency fee basis they know they won’t get paid until the client recovers. As a result, contingency fees provide a considerable amount of motivation for attorneys as they pursue their client’s claim. These fees open the doors of the legal system and provide equal access for the injured to seek redress. If contingency fees ceased to exist, then the doors of justice would remain forever closed to a large segment of our society.