How Do Personal Injury Lawyers Get Paid?
Have you suffered injuries or damages caused by another's intentional act or negligence? Are you considering hiring a personal injury attorney but do not understand how they are paid?
At Rosenfeld Injury Lawyers, LLC, our personal injury attorneys work through contingency fee agreements, meaning our fees are paid only after successfully resolving the case. Contact us today at (888) 424-5757 (toll-free phone number) or use the contact form to schedule a free evaluation for legal advice.
All sensitive or confidential information you share concerning your potential personal injury case with our lawyers remains private through an attorney-client relationship.
By now, you've probably reviewed several pages on our website that offer 'free case reviews' or 'no fee,' unless we are successful for you. However, you may be thinking, 'How do personal injury lawyers get paid?'
Every case we handle is done on a contingency fee basis. Under a contingency fee arrangement, our office receives a percentage of the total recovery for you. For example, we charge 1/3 (33.33%), a typical fee percentage, on most of our personal injury and medical malpractice cases.
We charge a 20% contingency fee, based primarily on a lump-sum recovery for you in workers' compensation matters. However, in cases where the defendant refuses to make a good faith offer, or both sides cannot agree to a negotiated settlement, we charge 40% because of the extensive work of preparing the case to present before the jury.
When you retain our office, you will sign a written contract that sets forth the terms of our representation and clearly states what the fee arrangement is for your case. You will receive a copy of this document for your records.
Although the contingency fees may appear excessive, most personal injury lawyers are gambling that they can win your case through litigation, negotiation, or going to trial. In many cases, the contingency fees are higher if the lawsuit must go to court due to the extensive costs of putting on a trial.
Why Hire a Personal Injury Lawyer?
Nearly all personal injury victims will hire an attorney to use their years of experience and comprehensive understanding of civil tort law. Usually, personal injury lawyers obtain financial recovery for their clients by winning their case in court or negotiating an out-of-court settlement.
Who Is a Personal Injury Attorney?
Personal injury lawyers have solid legal knowledge and expertise in handling civil cases under tort law. In addition, the attorneys provide legal advice, services, and redress against personal injury to their clients' physical well-being or reputation.
While personal injury lawyers may obtain additional certification, being an attorney in their practice jurisdiction is sufficient to handle nearly all civil tort cases. Additional certification may increase a lawyer's competitive edge and knowledge base above others.
What Personal Injury Cases Do Lawyers Handle?
Personal injury lawyers handle cases involving injury, property damage, and wrongful death that meet the threshold of damage caused by another's intentional, reckless, or negligent behavior.
Under civil tort law, any responsible party (defendant) may be subjected to pay the injured party for damages if deemed liable.
Common personal injury cases include accidents, slip & fall (premises liability), assault & battery, product liability, medical malpractice, nursing home abuse, dog bites & animal attacks, defamation, preventable death, etc.
Expenses to Pursue a Personal Injury Case
Hiring a personal injury attorney to handle a damage case usually incurs considerable expenses, including court costs, legal fees, payment for expert witnesses, and the funds necessary to obtain medical records and police reports.
However, the expenses are not limited to paying the attorney but investigating the case and finding evidence to prove another party was responsible for damages. Some of these expenses include:
- Trial expenses: These are costs incidental to proving the plaintiff's case in the civil court. Trial expenses include filing and disposition fees, expert witness fees, court reporters, legal research, and filing preparation costs.
- Police report: Insurance companies will typically object to no police report to corroborate the plaintiff's claim. To succeed in a personal injury case, lawyers must ensure that the official police report confirming the accident is available.
- Medical expenses: A personal injury case is typically instituted after the client's treatment. Lawyers must request medical records, expenses, and costs to ascertain the degree of injury. These documents and fees are crucial to claim against the insurance company and ascertain the strength and weakness of the plaintiff's case.
The upfront cost of ensuring that the victim receives necessary treatment generates substantial hospital bills, therapy expenses, and the cost of treatment. Additionally, preparing the case for a negotiated settlement or jury trial must be paid to allow the claim to move forward.
However, most personal injury attorneys will shoulder the financial burden, pay all the fees and expenses upfront, and get paid if the case is settled. Because of that, many lawyers will perform a comprehensive review of the facts to ensure that there is sufficient evidence to win compensation for their clients before accepting the case.
Before the case is accepted, the attorney will negotiate a contingency fee arrangement between the law firm and the client, outlining lawyer fees, legal costs, and other charges the lawyer believes will be necessary to reach a fair settlement. The arrangement is a legal promise that the client pays nothing if the attorney is unsuccessful at resolving the case.
The Fee Structure in Personal Injury Cases
To ensure that the case's merits are substantial enough to file a claim, the lawyer will typically discuss the legal issue during an initial consultation at no charge to the victim.
During the meeting, the lawyer will discuss their fee structure to ensure that their clients are not disadvantaged or disillusioned at what they should expect when the case is resolved.
Typically, many personal injury lawyers will have various fee structures depending on the strength or weakness of the plaintiff's case.
How a Contingency Fee Agreement Helps the Injured Party
For decades, the contingency fee agreement has remained the most common fee structure used in personal injury cases. The plaintiff and personal injury lawyers agree to a shared formula if the lawsuit succeeds in this structure.
The personal injury lawyer or law firm will shoulder the costs and other incidental expenses in this structure until the case is won. Should the case be lost, the client will pay nothing.
Typically, the expenses will then be covered after the excess of the lawsuit. Thus, the contingency fee arrangement incentivizes most personal injury lawyers to take cases they can likely win for their clients.
In this fee structure, all parties unequivocally agree beforehand to the sharing percentage. Thus, by law, it is unethical for a personal injury lawyer to create a back trap on the agreement, insisting on a higher percentage than initially agreed upon if the case succeeds.
In nearly all fee structures, the personal injury lawyers get far less than the plaintiff from the proceeds paid by the insurance company when accepting a case on a contingency fee basis.
Using this agreement, hiring a personal injury lawyer becomes necessary when the defendant's insurance company has refused to pay compensation or is inadequate.
Per Hour Billing
In some cases, the personal injury lawyer will accept the claim by charging an hourly rate calculated from beginning to end.
However, per-hour billing can be costly for the plaintiff to bear in this attorney-client agreement. Under this arrangement, it does not matter whether the personal injury case succeeds or not because the lawyer's hourly bill is fixed.
A per-hour billing arrangement is usually offered when the personal injury lawyer is confident that the plaintiff has a weak case and will likely not obtain a settlement.
Under the retainer fee structure, the plaintiff pays a lump sum of money from the onset. Then, the personal injury lawyer withdraws all fees and incidental expenses from the funds based on the case's weekly, monthly, or quarterly costs.
In this attorney-client agreement, when the funds in the retainer account have been spent, the client pays additional funds to cover all expenses incurred to keep the case moving forward. Thus, a retainer agreement is not always to the plaintiff's advantage.
What to Consider Before Filing a Personal Injury Claim
An attorney's job in an injury case includes the determination of liability and checking the insurance policy. Most personal injury lawyers will ascertain answers to specific questions, including:
- Does the defendant have an insurance policy?
- Is the policy coverage enough to cover a claim and other expenses, including court filing fees?
- Is there any liability coverage on the property if the injury is from a slip or fall?
Answers from these questions will determine whether the plaintiff will collect any granted damages after trial.
Every professional lawyer understands that winning a case is just part of the equation; enforcing judgment must also be considered. Defendant's insurance coverage and other assets must be ascertained before a personal injury claim is filed.
If the defendant is uninsured or the active policy is insufficient, there may be inadequate funds to negotiate or win at trial.
Consider an Out of Court Settlement
An out-of-court settlement is not only a faster means of resolving personal injury cases; it saves costs. Why rush to court when you could file a third-party claim, especially with any available insurance coverage?
According to statistics, possibly 95% of all injury cases are resolved out of court. The remaining 5% go to trial to be decided by a judge or jury's verdict.
However, these cases are often highly complex, or the defendant refuses to provide a good faith offer to settle the case.
Negotiating a Settlement
Getting the defendant's insurance carrier and policy number is the first step in this direction. Then, the attorney will send a notice of claim to the insurance company.
The notice must include the defendant and plaintiff's specifics, injury details, and the intention to pursue a claim.
In most cases, the insurance company will agree to a negotiated settlement to avoid going to trial. The local civil court should only be approached if the negotiation breaks down and parties fail to settle.
Ensure That the Case Is Not Statute-Barred
The law limits the amount of time to file a personal injury case and, like most civil cases, must be instituted based on the state's statute of limitation.
The lawyer will tell the potential client how much time is left during the initial consultation before the statute of limitations expires. Passing the time limit usually involves forfeiting the ability to ever seek financial compensation from the person or entity at fault at any time in the future.
However, there are exceptions in some instances, especially claims involving childhood sexual abuse that are usually not statute-barred or the time limit to decline jurisdiction is extended.
The Case Must Be Worthy
In some instances, it might be counterproductive to institute a personal injury lawsuit, especially where the injury is insignificant, or the defendant is also liable for the damage.
Instituting a personal injury lawsuit may also be counterproductive where some material facts are missing in the plaintiff's case. While attorneys do not usually charge an initial consultation fee in personal injury lawsuits, charging for their time might be necessary if it is apparent that there is insufficient evidence to prove the case.
Issue of Jurisdiction
For a personal injury lawsuit to be successful, the issue of jurisdiction must be settled. However, it is not in all cases that jurisdiction is apparent in a personal injury case.
What happens when the defendant resides in another state from where he caused the injury? In which state should the lawyer file? Should the lawyer file in a federal or state court?
It is worth noting that not every court's ruling is binding on the defendant and plaintiff were changing any final decision must be done in the appellate court.
Only courts with personal jurisdiction can give a binding ruling on the defendant in an individual injury case. A court will have jurisdiction if the defendant resides in the state where the action is filed.
It is imperative to note that a federal court has jurisdiction over limited personal injury claims. Therefore, it is essential to file in a court where the defendant resides, whether the lawsuit is filed in a federal or state court.
Jurisdiction is fundamental to the success of personal injury claims. Pursuing a lawsuit in a court without jurisdiction is an effort in futility.
When Personal Injury Is Not Physical
It is not in every case that personal injury caused to the plaintiff is physical. Damage against a person's reputation, as previously mentioned, falls under a personal injury claim.
The most common instances are libel and slander. The tort of defamation occurs when a false statement is published against the plaintiff. Slander occurs when false information calculated to damage a person's reputation is made.
The difference between the tort of libel and slander lies in the defaming and false statement publication. A publication is necessary to prove libel, while it is not necessary to prove slander.
In slander cases, it is enough to prove that a defaming statement was made against the plaintiff.
How We Charge and Bill
Our office pays for these expenses as the provider invoices us. In addition, we use an in-house accounting program to track the costs of each case.
We do not make any money on our clients' case expenses. We only seek reimbursement of these expenses when we are successful on your behalf.
If there is no recovery in your case, our office will absorb the expenses and not seek any contribution from you.
After the case, you will receive a 'closing statement.' The statement will show a full breakdown of the case settlement or verdict, including attorneys' fees, itemized case expenses, and any medical liens (for example, health insurance or treating physicians). In addition, the closing statement will show precisely how much money you will get from your case.
Below is an example of a closing or settlement resolving a case.
NAME OF CASE: YOUR NAME v. PARTY SUED
DATE OF ACCIDENT:
We hereby authorize my attorneys, Rosenfeld Law Offices LLC., to endorse my name upon any check(s) or draft(s) which they will receive in settlement of my claims for injuries & property damage sustained on
DATE OF INCIDENT. We further authorize said attorneys to deposit said check(s) or draft(s) to their trust account, and my attorneys are further authorized to make the following disbursements from the proceeds of the settlement:
Gross Settlement Amount
Rosenfeld Law Offices
Total Attorneys Fees
Costs Advanced by Rosenfeld Law Offices
Arbitration / Court Costs
Lien Resolution Services (Medicare)
Medical Records / Billing $209.56
Cook County Hospital $55.31
Chicago Police Department $10.00
Midwest Orthopedics $144.25
Investigation- Spain Breckinridge $33.00
Total Costs Advanced $86.51
Liens / Outstanding Medical Expense $21,297.18
Michigan Avenue Medical ($ 734.00) $367.00
Premier Physical Therapy ($1,300.00) $515.00
Key Health ($830.36) $415.18
Blue Cross / Blue Shield ($38,233.00) $20,000.00
NET TO CLIENT: $45,073.42
We further authorize said attorneys to mail the balance of the settlement proceeds in the sum of $45,073.42 to me at the address below after said settlement check(s) and/or draft(s) have cleared. Clients further agree that they are responsible for all medical bills other than those listed on this settlement statement.
Clients indemnify and hold harmless Rosenfeld Law Offices LLC from all liens and claims by hospitals, doctors, insurers seeking reimbursement, public aid, or other parties who rendered medical or other services arising out of this occurrence. Lastly, the client understands that this settlement is subject to the approval of bankruptcy proceedings and court approval.
Are You Ready to Move Forward With a Personal Injury or Medical Negligence Case?
At Rosenfeld Injury Lawyers LLC, our injury lawyers appreciate that following an incident can be stressful for the individual and their family. We have helped thousands of people obtain compensation for their situation and look forward to serving you. We are here for in-person or telephone consultations anytime.
Our goal is to provide you with the best possible legal representation to obtain the maximum possible recovery as quickly as feasible.
Hiring A Personal Injury Attorney To Resolve Your Compensation Case
Are you a victim of an auto accident, medical malpractice, harmful medication, or another incident that led to your damage? Did your injuries occur from another's negligence?
At Rosenfeld Injury Lawyers, LLC, our personal injury attorneys represent injured victims seeking justice and financial compensation. Call our law office at (888) 424-5757 (toll-free phone number) or use the contact form today to schedule a free legal consultation.
Our legal team accepts all personal injury cases and wrongful death lawsuits through contingency fee agreements, meaning no upfront lawyer's fees are paid until the legal matter is resolved through a negotiated settlement or jury award.
All sensitive or confidential information you share with our law office remains private through an attorney-client relationship. Contact us today to ensure that your case is filed before the statute of limitations expires.
Surviving family members who lost a loved one can file a wrongful death lawsuit against any party that caused their preventable death. In addition, qualified families can receive financial compensation, including medical bills, hospitalization costs, lost wages, future lost earnings, loss of familial support, pain, suffering, grief, mental anguish, funeral & burial costs.