The percentage an Alabama injury lawyer takes from a case is outlined in a document called a contingency payment agreement. Clients generally come to an agreement with their personal injury lawyer regarding what percentage the lawyer will receive if the client is awarded damages.The details and terms of the agreement should always be in writing.
Contingency agreements must always specify the amount that the lawyer will be paid if your case is won or a settlement is reached. This amount will usually be stated as a percentage of the whole amount and will vary based on the specifics of your case. Injury lawyers usually collect between 33% and 40% of the total injury compensation awarded.
The Purpose of Contingency Payment Agreements
If you have been injured due to someone else’s negligence, the stress of finding a way to pay your bills and support your family while you heal can be overwhelming. If you were expected to pay an injury lawyer upfront, you would be much less likely to pursue compensation. If you did pursue compensation, it would likely be without legal representation.
A contingency payment agreement states you will pay your lawyer a percentage of the total amount you are awarded if you win your case. The percentage is based on the amount awarded for injuries and excludes compensation you may receive for property damages or medical bills. The rules that define contingency payment terms in Alabama and the lawyer-client relationship can be found in the Alabama Rules of Professional Conduct.
Contingency Fee Cap
In some states, the law limits the amount that a lawyer can be paid in a contingency agreement to 33.33% if the case is settled before a lawsuit is filed and 40% if it is settled after filing or a trial is held. Some lawyers may require that a deposit be paid in advance to offset some of the expenses they will incur while investigating your claim.
Alabama has not placed a cap on the amount that a lawyer can request in a contingency agreement. Alabama injury lawyers generally request between 33% and 40%, but there are several factors that can cause them to increase that amount. No matter what percentage the lawyer requests, the agreement should be in writing, and both you and the lawyer must sign it for it to be valid.
A contingency agreement requires both you and your lawyer to agree to the terms. When disagreements cannot be resolved, you may find it helpful to discuss the matter in mediation or arbitration.
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When Contingency Payment Agreements Are Not Allowed
You cannot enter into a contingency payment agreement with a lawyer if you are facing criminal charges or involved in a domestic matter. This means you cannot agree to pay contingent on a favorable divorce allocation or an order to receive alimony.
Ethics Consideration §2-20 states that “a lawyer should generally decline to accept” this type of payment when a client is “able to pay a reasonable set fee.” Contingency agreements are generally allowed in US civil cases if the terms are clear in the written agreement.
How Contingency Payment Agreements Benefit You and Your Lawyer
There are several reasons why a contingency payment arrangement can be beneficial to you and your lawyer.
- They make it possible to seek compensation regardless of your financial situation.
- They can lower your out-of-pocket expense.
- Your lawyer will put forth more effort to ensure they are paid.
- They discourage lawyers from taking cases that they are not likely to win.
- Lawyers cannot manipulate their fees by wasting time on tasks that are paid hourly.
- Lawyers can be certain they will be paid when your case is won because they disperse the money.
Charges that Might Be Billed Separately Before Settlement
Some lawyers charge all-inclusive fees, while others charge a fee for representation and request additional funds for incidentals like filing fees. Your contingency payment agreement should specify how these charges will be paid. If unforeseen costs arise, your lawyer should discuss this with you and ask you to sign a new agreement.
When Additional Charges Must Be Paid
Your lawyer may ask that additional charges be paid as they are incurred, or they may bill them after the case is closed. The lawyer’s expectations for payment of additional charges should be stated in the contingency agreement. When unforeseen charges arise, writing a new agreement is the best way to ensure that everyone is on the same page.
Alternative Options for Payment
A contingency payment plan is a great option for someone who may not have the resources to pay out of pocket. When clients do have the resources available, lawyers are discouraged from providing services on a contingency basis. These payment agreements are intended for clients who would otherwise be unable to seek compensation for their injuries.
Before you sign a contingency payment agreement, you should read over the terms carefully and ensure that you know what is expected of you and when.
Contact an Alabama Injury Lawyer You Can Trust
An injury lawyer who lacks experience and is unfamiliar with the law may be eager to take your case with little or no evidence because they are seeking experience. Do not let unknowledgeable lawyers scam you out of compensation to boost their reputations. Whether you are in Huntsville, Montgomery, or anywhere in between, Morris Bart has a law office near you.
An experienced and knowledgeable injury lawyer is not likely to take your case on a contingency fee basis if they do not believe they can win. When you need an Alabama injury lawyer, you can trust the Morris Bart law firm. Contact us today and schedule your free case consultation with an Alabama injury lawyer you can trust.
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