A contingency fee means the lawyer is paid a percentage of any recovery instead of an hourly rate. If there is no recovery, there is usually no fee. The details that matter are the percentage, how costs are handled and when the fee is calculated.
How does the math work on a settlement?
Two agreements with the same percentage can leave you with different amounts. The difference is whether case costs come out before or after the fee is calculated. Here is a worked example with round numbers.
| Step | Costs after the fee | Costs before the fee |
|---|---|---|
| Settlement | $90,000 | $90,000 |
| Case costs | $3,000 | $3,000 |
| Fee at one third | $30,000 on $90,000 | $29,000 on $87,000 |
| Before medical liens | $57,000 | $58,000 |
Illustrative arithmetic only, not a prediction of any case value or a quote of our fee.
A good fee agreement is one you can explain to a family member after reading it once.
What is the difference between fees and costs?
Usually a fee
- The lawyer's time and judgment
- Negotiation with adjusters
- Drafting the demand and filings
- Trial preparation
Usually a cost
- Medical record charges
- Court filing fees
- Expert reports
- Deposition transcripts
What should you ask before you sign?
- What is the percentage, and does it change if a lawsuit is filed or the case goes to trial?
- Are costs taken out before or after the fee is calculated?
- Who pays the costs if there is no recovery?
- How are medical liens and health insurance repayment handled?
What does Ohio require in writing?
- Signedcontingency agreements must be in writing and signed
- Itemizeda closing statement shows the fee, costs and liens
- 0up-front cost in most injury cases
General information about Ohio professional rules, not legal advice.
- 01
Read the agreement at home
Take it with you. A good firm will not rush you.
- 02
Ask about the percentage steps
Settlement, lawsuit and trial can carry different rates.
- 03
Ask how you will be updated
Offers, costs and liens should arrive in writing.
- 04
Keep your copy
You will compare it with the closing statement at the end.
Questions readers ask
Sometimes. Ask directly and get the answer in writing.
In most injury cases, no. Confirm this in the agreement.
Agreements differ on costs. Ask, and make sure the answer is in writing.
Sometimes in employment and other claims. Estate planning and business work are usually flat or hourly.
Marcus Reyes, Partner. Marcus represents people hurt in crashes and falls. He builds each claim around clear documentation and steady communication with the client.
Read Marcus's profileThis article is general information about Ohio law, not legal advice, and reading it does not create an attorney-client relationship.
