Contingency Fee

When a person sustains an injury, they in most cases will incur economic damages. These damages are financial losses and expenses related to the injury. For example, the person may incur substantial medical bills and lost wages because of a car accident.

Paying a large retainer fee to hire a personal injury attorney might be impossible given the situation. A contingent fee basis allows an injured person to retain the services of an experienced injury lawyer without worrying about paying upfront fees.

Everyone deserves experienced legal representation to seek compensation after an injury or accident, regardless of their financial situation. An injured victim should not be “punished” because they experience a financial crisis after an injury or accident.

Taking cases on a contingency fee basis also encourages attorneys to work diligently to win the case. Their fees are directly tied to the outcome of the personal injury claim. They do not get paid if they do not recover money for the client.

Personal injury lawyers are required to charge reasonable fees in Florida. The Model Rules of Professional Conduct (Rule 1.5) require attorneys to charge reasonable rates for their services. Contingency fees may be based on several factors, including:

• The lawyer’s experience, skills, and education
• The type of case and the parties involved in the case
• The average fees charged by other attorneys of similar experience in the area
• The time the attorney expects to spend working on the case
• Whether the case settles without the need to file a lawsuit and go to trial



Attorneys who work on a contingency fee basis must also follow the Florida laws regarding contingency fees. The Florida Rules of Professional Conduct set forth the following requirements for contingency fee agreements:

• A contingency fee agreement must be in writing
• The terms of the agreement must state the specific fee percentages charged by the attorney
• The agreement must contain an acknowledgment that the client reviewed the Client’s Rights
• The client may negotiate the percentage used for the contingency fee
• A contingency fee agreement must contain a clause that allows the client to cancel the agreement within three business days without owing the lawyer any fees for legal services

Attorneys may use contingency fees for all types of personal injury cases. However, Florida laws limit or restrict the percentages charged in specific cases.

The Florida Rules of Professional Conduct state that a lawyer cannot charge a contingency fee for family law cases if the attorney’s fee is:

• Contingent upon the client obtaining a divorce; or,
• Contingent upon the obtaining an amount of alimony, child support, or property settlement

Contingency fees are also not permitted in criminal cases. In addition, excessive fees are prohibited in personal injury cases. Therefore, the rules specify the maximum amount a lawyer can charge a client for contingency fees.

The amounts are based on when the case is resolved. They are also scaled to decrease as the settlement amount increases.

For example, the maximum contingency fee for a matter settled before the other party files an answer or demands the appointment of arbitrators is:

• 33 1/3% of the first $1 million recovered
• 30% of the next million dollars recovered
• 20% of any amount recovered over $2 million

If the case does not settle until after the other party files a response to the lawsuit, the maximum contingency fee increases. Instead of 33 1/3% of the first million dollars recovered, the maximum contingency fee is 40%. The sliding scale works the same as the sliding scale using different percentages.

However, the above rules do not apply in medical malpractice cases. The Florida Constitution sets the maximum contingency fee for medical malpractice cases. The attorney may charge 30% of the first $250,000 in damages. The fee for anything above $250,000 is 10%. A client can voluntarily agree to pay a higher percentage for a contingency fee, but they are not required to do so by law.

All personal injury cases are unique, depending on the facts and circumstances. The strategy a lawyer takes for each case is personalized to the client.

That said, examples of things an attorney might do when pursuing a personal injury claim for a client include:

• Investigate the circumstances surrounding the client’s injuries
• Identify all parties who could be potentially liable for damages
• Review insurance coverage and file appropriate insurance claims
• Monitor all deadlines for filing claims and lawsuits
• Gather evidence proving causation, fault, and damages, including working with expert witnesses
• Document the client’s damages and calculate how much the claim is worth
• Prepare a demand letter to send to the insurance company
• Negotiate a fair settlement
• Prepare all documents necessary for the settlement

Throughout the process, the attorney advises the clients and helps them consider their options. The lawyer may suggest filing a lawsuit if the other party refuses to agree to a fair settlement amount.

Before signing a contingency fee agreement, read the entire agreement to ensure you understand the various amounts charged. Ask the attorney about who is responsible for paying the costs of the case, including if you win or lose the case.