Personal Injury Lawsuit

In just about any personal injury attorney advertisement the words “no recovery, no fee” are usually displayed prominently. Though in the United States contingency fees have become standard for personal injury cases, they are not always applicable in other legal practices such as family and criminal law. Understanding legal fees is important when contemplating a personal injury lawsuit.

Typically, when one hires an attorney to perform legal work the client can be presented with several different methods of payment. Some attorneys work on a flat fee basis which is based on the specifics of the legal issue. This type of fee arrangement may include assistance with simple or routine legal forms. More common are time based fees, where the client pays the attorney to work on an hourly basis. In this instance, the client pays the attorney a “retainer” fee or a certain sum to be billed against. Then there are contingency fees. With a contingent fee, the attorney shares the risk with the client. If there is no settlement or court award then the client does not owe the attorney anything for his work. If the case does produce a monetary settlement or award then the attorney charges an agreed upon percentage as their fee for representing the clients case. These fees are not fixed by law and may be the subject of negotiation between the personal injury attorney and personal injury client. The contingent fee is an important vehicle in securing an accident victim the personal injury attorney of their choice. Financial inability does not stand in the way of the accident victim securing the personal injury attorney of their choice as the contingency fee arrangement allows any accident or injury victim, even those without funds, to retain an attorney to represent them.

Contingency fees can vary depending on the legal situation. Many times, an attorney will charge a lower percentage of the total recovery if a case is able to be settled out of court. The contingent fee percentage of recovery will usually increase if a case cannot be settled and goes into litigation. The contingent fee for a minor (person under 18 years of age) will be set by the court. In the event that a case involving a minor is brought before the court for approval, the court is asked to review and approve the settlement through a procedure called a “minor’s compromise”. This aids in the protection of the minor, and applies to personal injury cases, both big and small. When dealing with medical malpractice cases in California there is a statute that places a fixed cap percentage as the maximum that may be charged as the contingent fee.

The victim of a personal injury should thoroughly discuss any potential fee arrangements with their prospective attorney. This discussion will ensure that the accident victim has a complete and total understanding of the attorney’s fees, and how those fees will be calculated. All reputable personal injury lawyers will gladly take the requisite time to ensure that their clients understand the process.

The reputation of ‘no win, no fee’ cases has been tainted in the last few years due to a number of high profile cases.

It is argued that this concept effectively replaced legal aid for routine accident claims in 2000, with a ‘misleading’ tag-line for deals that are more formally known as conditional fee agreements (CFAs).

Much of this agreements bad press has revolved around claims that some insurance companies had sent bands of representatives on to the high streets of Britain to sign up unsuspecting clients, yet in the past few years thousands of accident victims have seen their payments for damages consumed by the costs associated with these companies.

In 2004, women claiming to have been sexually assaulted by disgraced gynaecologist Rodney Leward, saw their case collapse after a High Court Judge ordered an urgent investigation in to their solicitor, Jane Loveday, and her handling of their multi-million pound compensation claim.

At the end of the case, the women each received a bill for between £12,000 and £14,000 to pay their part of the court costs. One of the women involved said, “I thought it was a ‘no win, no fee’ case. I asked a load of questions about what happens if…and I said am I on a ‘no win, no fee’ aren’t I? I got sort of sidelined. I was very naïve’

It could be said that a CFA or ‘no win, no fee’ case allows a lawyer to surrender their fees if they think their client has a good case and they themselves have got it wrong. It also allows them to charge an extra amount if they win, which the other side are liable to pay, effectively doubling their fees.

Andrew Twambley, a managing partner of Manchester solicitors Amelans, who run Injury Lawyers 4U said, “CFAs have been unfairly discredited because of concerns over one or tow high profile incidents, whereas millions and millions of cases have been done successfully”.

Twambley argues that the hole left by legal aid has been filled by conditional fees, which is crucial to the government and there outlook on controlling spending on public funding for legal cases. “Decrying CFAs is like banning flying because a couple of planes have crashed. On the whole, conditional fees are a really good thing for providing access to justice for people who would never get it. Having said that, people need to know what they’re doing and be careful about who they go to”.

However, the National Association of Citizens Advice Bureaux (Nacab) doesn’t seem as convinced about the positives of CFAs. They argue that most personal injury cases are settled out of court for in the region of £3,000 to £4,000 which is not inclusive of costs. James Sandbach of Nacab says, “Costs under CFA can be almost as much, and instantly whatever you’ve gained is wiped out.”

“‘No win, no fee’ does not mean ‘no win, no cost’. If a case is unsuccessful, the client will be liable for their opponents’ legal costs unless they have insurance to cover this.”