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Q: What is a contingency fee? I have been looking for a good attorney after my car accident in Lebanon, and everyone mentions contingency fees—but I don’t remember them from my divorce in 2009 or my DUI case a few years before that. Is this something new?

A:

Contingency fees—sometimes called contingent fees—are pretty easy to explain. As car accident lawyers, we will put forward our best efforts on behalf of our injured clients. Those clients do not have to give us any money at the start of the case to represent them. Instead, we will take our fee out of the recovery we get for them. This could be...

  • A settlement with the other party or insurance agency that our client accepts.
  • A jury award for damages, or a judge’s damages award, if both sides waive their rights to a jury trial.

Notice that whether we get to collect a legal fee at all depends on—or, in legal terms, “is contingent upon”—our getting a financial recovery in the first place. If the client rejects a settlement and the case goes to trial, and we lose the trial, then our client gets nothing (and we get nothing, too).

Hiring and Paying your Pennsylvania Personal Injury Lawyer

The way our law firm, Schmidt Kramer, handles being hired by a client is typical of most Pennsylvania injury legal firms. Early on, you will have a free conference with one of our attorneys. This will be his first chance to look at your potential claim, and this is your first chance to meet the person who would be acting as your legal representative. This is a great opportunity for both the attorney and the client to find out whether they can be comfortable working together.

At the end of this meeting, you are free to walk away. There is no obligation to deal with us further.

Similarly, on rare occasions our attorney might tell you we’re not interested in taking your case. We’ll explain why, but most often it boils down to one of two reasons:

  1. We don’t think the evidence is sufficient to prove that someone else was at fault for your Pennsylvania motor vehicle accident.
  2. We think the amount we can expect to recover is so small that we would not recoup our expenses in investigating your case and pursuing compensation.

Usually, though, we will offer a contract for you and your prospective lawyer to sign. The contract sets out the terms of the contingency fee. Generally, we ask for 30 to 40 percent of the amount we recover on your behalf as our share. Of course, the contract just determines the relative sizes of how the “pie” is shared—once we sign it, it becomes our job to get as big an award or settlement as possible.

Special rules about contingency fees

Because of the contingency fee contract, you do not have to pay us anything in advance for our work on your behalf. You don’t have to pay a retainer, or “earnest money,” or a deposit on your legal fees. We take all the risk that you will eventually recover enough to make our investment in time worthwhile.

There may be some other fees, though, that you will be required to pay along the way. Court filing fees, the expenses for copying documents, and any expenses related to getting depositions from witnesses are usually the client’s responsibility, and you will have to pay these costs regardless of how much you recover.

Attorneys for other types of cases don’t often use contingent fees. They charge a fixed fee per hour of work, or sometimes a flat fee for each specific legal filing or other service. The Supreme Court of Pennsylvania has laid out ethics rules for attorneys in the Commonwealth, and part of these Pennsylvania Rules of Professional Conduct (section 1.5d) prohibits contingency fees for domestic relations or for criminal defense work. That explains why you weren’t given a contingency fee option for your divorce or DUI defense.

Need a Pennsylvania Auto Accident Attorney? Call Schmidt Kramer

At Schmidt Kramer, we use contingency fees for our business representing car accident victims in Harrisburg and surrounding communities. Our record of success should give you confidence in our ability to win a settlement or damage award that leaves you cushioned against the future.

To schedule a confidential case review at no charge, call us at 717-888-8888 or 888-476-0807 toll-free. When you make the call, be sure to request a copy of our client book, Who Pays The Bills When You Are Injured In An Automobile Accident?, which we will send you absolutely FREE as a way of introducing our firm.