What Percentage Do Lawyers Take for Personal Injury Cases in Philadelphia?
Unlike many other lawsuits, attorneys in personal injury cases are most often paid through a contingency fee agreement. If you're asking what percentage do lawyers take for personal injury services, the answer is they usually receive 33-55% of the award as payment fees. In these cases, the person filing the claim (the plaintiff) agrees to pay the suit’s costs and a percentage of the damages received to the lawyer handling the case. If the plaintiff loses, there are no attorneys’ fees paid. Pennsylvania law requires that the agreement be in writing.
Where Do Contingency Fee Come From?
In the so-called English system, the person who loses a lawsuit generally has to pay all the fees and costs of both sides. This policy makes filing a lawsuit a risky proposition and limits access to the courts. American courts, however, do not apply this rule and require each party, barring extraordinary circumstances, to pay their own fees regardless of who wins.
To further increase access to the courts by injured parties, the American system also permits contingency fees. If you're wondering what percentage lawyers take for personal injury cases, this is part of tat percentage. A contingency fee is a legal fee where the duty to pay is contingent upon winning the lawsuit and is usually a percentage of the damages awarded. Pennsylvania law permits and recognizes the virtues of contingency fee agreements.
What Percentage Do Lawyers Take for Personal Injury with a Contingency Fee Arrangement in Philadelphia?
A contingency fee arrangement generally requires little or nothing upfront when filing a lawsuit. Instead, the plaintiff and the attorney enter into a written agreement outlining the terms of the contingency fee, and the lawyer files the suit. Usually, the agreement states that the attorney will receive payment only if the lawsuit is successful and states the percentage of the award that will go to the attorney.
Although many states limit the rate that an attorney can charge, Pennsylvania does not impose a limit. The lack of a limit may cause alarm when you're asking what percentage do lawyers take for personal injury services. However, the Pennsylvania Rules of Professional Conduct for lawyers do set forth ethical limits on what an appropriate fee might be.
Wen asking what percentage do lawyers take for personal injury cases, the average range for contingency fees in a personal injury case in Pennsylvania is 33 to 45% of the award. The national average ranges from 20 to 50% of the recovery.
What Is a Reasonable Contingency Fee?
A contingency fee must be reasonable in relation to:
- The type of case
- The circumstances of the case
- The skill required
- The work necessary for the case
- Any other factors considered by the court
The attorney should also consider the policy limits of applicable insurance policies and whether the fee will be unreasonable in relation to those limits. Pennsylvania law does not limit the size of contingent fees, and the courts have expressly upheld a fee of a third of the award.
Can the Attorney Prepay the Expenses in a Contingency Case?
The contingency fee arrangement must outline all the specifics of the plaintiff and the attorney’s financial agreement. The agreement may or may not cover prepayment of expenses such as filing fees for the suit. Prepayment of such fees does not make the contingent fee agreement illegal.
Although it is not unlawful for the attorney to prepay your expenses, most contingency agreements do not include them as part of the percentage due to the attorney. You will therefore receive your specified portion, but the prepaid expenses will be subtracted from it. In other words, if your award is $100,000, your fee is 40%, and there are $5,000 in expenses, you would receive $55,000, not $60,000.
Expenses If You Lose in Philadelphia
Even in a suit the plaintiff loses, there will be non-legal-fee expenses that have to be paid. Attorneys generally handle these expenses in one of two ways. Some firms absorb the costs, probably having calculated that probability into their overall contingency fee ranges. Others will expect the plaintiff to pay the expenses regardless of the outcome of the lawsuit. Sometimes the decision is based on what the lawyer sees as the strength of the case. In any event, how these will be handle should be in the fee agreement.
Getting the Details Right
The clarity of a contingency fee agreement is vitally important. The last thing a successful plaintiff wants after winning a lawsuit is a dispute with his attorney about the fees. As seen in the previous paragraph, it is essential to address all the issues when drafting a fee agreement.
Your lawyer will probably give you his standard agreement, but you can feel free to negotiate the terms or look for a better deal elsewhere. You should be sure that the agreement covers the percentage, assigns responsibility for costs, and addresses any adjustments that might be made based on a quick settlement or other similar issues.
How Personal Injury Victims Benefit From Contingency Fee Agreements
When paid for by the hour, litigation comes at an astronomical cost. Fees of several hundred dollars an hour are standard, and even cases that settle out of court result in hundreds of billable hours.
Without contingency fee agreements, most accident victims can ill-afford legal representation. If plaintiffs lack counsel, insurance companies have little incentive to settle cases quickly for a fair amount. With the advantage of a team of attorneys, defendants can capitalize on plaintiffs’ pro se status to shortchange them. In the worst-case scenarios, pro se plaintiffs cannot refute defense lawyer arguments, resulting in lost cases and zero compensation.
Contingency fees also help plaintiffs who suffer financial hardship due to the injury. For example, after being struck by a vehicle, an accident victim usually acquires hefty medical bills. Emergency room treatment, ambulance service, surgery, doctor visits, physical therapy, and other significant expenses easily total in the tens- or hundreds of thousands of dollars. Very few households can cope with extensive medical- or legal bills separately, let alone simultaneously.
On top of medical bills, injury victims often endure lost income. Broken legs, back injuries, and head wounds often lead to long periods of disability. In the most difficult situations, disabilities become permanent.
Loss of income devastates families. They may need to spend down their savings, cash in retirement plans, and carry heavy credit card balances at sky-high interest rates.. In addition, the financial pinch leaves no room for paying hundreds of dollars an hour in legal fees.
Many accident victims also live through enormous pain and suffering. Because of their injuries, they have chronic pain and lose the ability to participate in activities they love. In addition, daily life often becomes difficult. For example, personal injuries can make it impossible to complete simple chores around the house or go grocery shopping. In many cases, victims bear the expense of hiring a service to perform these functions.
With all of these struggles, accident victims need a helping hand. They receive it from personal injury law firms that take cases on a contingency fee basis. Because of these arrangements, clients are relieved of the stress of paying legal fees, allowing them to focus on what’s most important: getting better.
Contingency Fee Agreements Take the Uncertainty Out of Legal Fees
When paid hourly, legal fees are unpredictable. Some cases settle out of court in less than a year, resulting in less expense to the plaintiff. Other matters drag on for many years because the defense tries to delay the case’s progress and wear down the plaintiff. As the process unfolds, legal fees for lengthy processes mount, such as discovery, depositions, hearings, research, and witness preparation. If the case goes to trial, the court time alone costs tens of thousands of dollars.
Without predictability as to the out-of-pocket costs, many plaintiffs would be unable to proceed. Without contingency fees, personal injury cases can easily consume a family’s entire net worth. Because personal injury lawyers work on contingency, plaintiffs know their exact out-of-pocket costs: $0.
Contingency Fee Agreements Cover Expenses
Many personal injury cases require expenses beyond attorneys’ fees. These include private investigators, expert witnesses, and research. As with attorneys’ fees, the level of expenditures may be difficult to estimate at the outset; however, as with attorneys’ fees, expenses are covered by the contingency fee agreement. Winning a case may require procuring evidence at a high cost, and contingency fees ensure that the plaintiff’s inability to pay out-of-pocket costs never bars them from receiving justice.
Contingency Fees Level the Playing Field
Insurance companies always have one huge advantage: They have loads of money for lawyers. This automatically places personal injury plaintiffs at a disadvantage. Insurance companies can pay to fight a case in court for years, and only a very rare plaintiff can match their spending power.
Contingency fee agreements work to equalize the plaintiff and defendant financially. Without contingency fees, many plaintiffs with excellent cases would have to accept low settlements or give up because of the astronomical legal costs. By removing this burden from their clients, personal injury attorneys prevent insurance companies from capitalizing on their deep pockets to cheat plaintiffs.
Contingency Fees Reduce Risk
Paying legal fees hourly exposes plaintiffs to the risk of running out of money to fund the legal fight. Law firms eliminate this risk by taking cases on contingency. As a result, plaintiffs can sleep well at night knowing they can continue battling the insurance company for as long as it takes to win a fair settlement. Then, if necessary, they can proceed to trial and through appeals without the fear of going broke in the process.
Call Us to Speak with a Philadelphia Personal Injury Lawyer
If you're asking what percentage do lawyers take for personal injury, you should consult different lawyers and compare their fees. We invite you to vett our Philadelphia personal injury lawyers and our fees. Contact the law offices of John Mattiacci today for a free case evaluation. Remeber that we will never collect legal fees unless we win your case.
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