What Is A Contingency Fee Agreement?

In a contingency fee agreement the client agrees to give his or her lawyer a certain percentage of the money recovered in either a settlements or verdict.  When the client's case is won the attorney will deduct his or her fee (plus applicable costs and fees) from the recovered sum. Additionally, the attorney may also deduct third-party expenses from the recoverable sum. These expenses can include:

  • Filing fees
  • Photocopying fees
  • Court reporter fees
  • Law office staff fees
  • Expert witness fees
  • Deposition fees, and more 

If your case is lost, you may still be liable for these listed fees. It's important to fully read and understand your contingency fee agreement before signing. 

If you enter into a contingency fee agreement with your lawyer be sure your written agreement spells out the percentage of money you and your lawyer will receive, and how it will be split. You should also understand the difference in percentage you will receive if your case is settled out of court or if your case goes to trial. 

If possible and applicable, ask your attorney to provide you with an estimate of court costs and other expenses, and find out whether the lawyer's share is paid before or after other expenses are deducted.

Finally, it should be noted that some states do not allow contingency fee agreements for certain types of cases. Contingency fee agreements are generally not allowed in divorce or criminal cases.

The information on this page is meant to provide a general overview of the law. The laws in your state and/or city may deviate significantly from those described here. If you have specific questions related to your situation you should speak with a local attorney.

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