A contingency fee is a payment arrangement where your attorney's fee is a percentage of the money recovered in your case. If you don't win or receive a settlement, you generally don't owe any attorney fees.
How it works:
The typical contingency fee is 33% (one-third) of the recovery if the case settles before trial. If the case goes to trial, the fee usually increases to 40%. Some attorneys charge on a sliding scale based on the stage of resolution.
What's covered:
The contingency fee covers the attorney's time and legal work. However, you may still be responsible for case costs and expenses — filing fees, expert witness fees, deposition costs, medical record fees, etc. Some attorneys advance these costs and deduct them from the recovery; others require you to pay as they arise.
Where contingency fees are common:
Personal injury cases (car accidents, slip and falls, medical malpractice). Workers' compensation claims. Employment discrimination cases. Product liability cases. Class action lawsuits.
Advantages: Access to justice regardless of financial means. The attorney is motivated to maximize your recovery. You bear no financial risk if the case is unsuccessful.
Make sure to clarify: Whether costs are separate from the fee. Whether the fee percentage applies before or after costs are deducted. What happens if you terminate the attorney or they withdraw.