How Do Personal Injury Contingent Fee Agreements Work in Florida?

Posted By on May 24, 2017

How Much Money Will A Victim Receive if a Settlement or Jury Award is Granted In a Personal Injury Lawsuit?

If you have been injured in a car accident or a slip and fall in Florida and have hired a personal injury attorney to represent you with your claim for compensation, then you have likely entered into a “contingent fee agreement” with that lawyer.

FEMA - 14016 - Photograph by Jocelyn Augustino taken on 07-14-2005 in Florida

What happens to the hospital bill when you sign a contingent fee agreement?

What is a Contingent Fee Agreement?

A “contingent fee agreement” is a type of written legal agreement where you and your attorney establish an attorney-client relationship.  These agreements are required when hiring a lawyer to commence legal representation on a contingent personal injury matter.

The language in a contingent fee agreement outlines how much an attorney will be compensated for his or her services. This amount paid to the attorney for services rendered is contingent upon:

(1) A settlement of the case;

(2) A trial verdict in favor of the injured party; or

(3) An arbitration award on your behalf.

Thus, a personal injury lawyer will not receive payment for services rendered unless the victim receives compensation from the negligent party (or their insurance company).

Does The Client Pay a Retainer to The Attorney?

In most contingency fee agreements, a client does not pay a retainer to the attorney. A retainer is typically only required in cases where the lawyer is being paid an hourly rate, and not on a contingency fee basis.

How is The Attorney Fee Determined?

At the time the contingent fee agreement is signed, the lawyer will discuss with the client the percentage of the recovery that will be paid to the lawyer for his or her services. Some common issues that impact the percentage paid to a personal injury lawyer include:

1.  If The Case Goes to Trial or Appeal

Most personal injury contingency fee agreements allow for the percentage paid to the lawyer to increase if the case goes to trial, with another increase if the case is appealed.

2.  If The Lawyer is Not Successful

The key factor in a contingent fee agreement is that the lawyer will not be paid unless the case is won and damages are paid to the victim.
Additionally, the accident victim does not have to pay his or her lawyer while the case or claim is being pursued.

3.  Florida Rules of Professional Conduct Set the Percentages

Every lawyer licensed to practice in the State of Florida is governed by the Florida Rules of Professional Conduct (“Rules”), as set forth by the Florida Supreme Court.

These rules set the maximum percentage rate that can be charged by a Florida personal injury attorney in a contingent fee contract. This is true unless:

(1) a smaller fee is agreed upon and written into the contingent fee agreement; or

(2) the court approves a higher fee at the time that the case is filed as a lawsuit.

**Note: There are different rules for standard accident and injury matters and medical malpractice contingent fee cases.

For details in how these percentages are established under the Rules, and “creative attorneys’ fees,” read the discussion of “Personal Injury Fees in Florida,” on our website HallandaleLaw.com.

How Does The Amount of Compensation Received By a Victim Change When a Personal Injury Lawsuit is Filed?

The longer a claim or case stays open, the more costly it becomes for the plaintiff. That’s because contingent fee agreements state that the victim’s personal injury lawyer receives more compensation if the case requires filing a personal injury lawsuit.

Because the amount of fee paid to a personal injury lawyer increases once a lawsuit is filed, some clients instead choose to accept a pre-suit settlement offer.

Sometimes, the best time to accept a settlement offer is during pre-suit negotiations with an insurance adjuster. This is true even where the liability is clear and the documentation of damages is well established. (For more on this issue, read our post on documenting your Florida personal injury case.)

However, a victim is sometimes unable to settle their claim quickly, as insurance adjuster will try to diminish their damages as much as possible. This is commonly seen with car accident injury claims.

See: Why is it hard to get a settlement in a rear end car accident claim?

Trial and Appeal

When pre-suit settlement can’t be reached, a victim must file a personal injury lawsuit in order to get justice.

When a case is in litigation, your lawyer will have to spend additional time and money to purse a claim. This in turn means the compensation your lawyer will receive will increase. That’s because of the time spent on things like discovery, attending court hearings and the trial and the costs for things like expert witnesses, filing fees, discovery fees, services of process, and court reporter related charges.

Furthermore, in the event an Appeal is filed, then the lawyer will have to perform even more work including legal research, drafting an appellate brief, possibly drafting a responsive brief and/or arguing before the appellate court, along with paying for trial transcripts. All of this extra works involves many hours of work, which is why a higher fee is charged when a case is take up on appeal.

Read: What Happens in a Deposition for a Personal Injury Case?

Co-Representation

Sometimes, your lawyer will find it advantageous to your case to bring in additional counsel to pursue a claim.  The are several situations in which a client may benefit from having additional lawyers working on their file.

One common example is “local counsel,” where hiring an attorney from the local area is helpful when the case is being litigated in another county or other part of the state.

More commonly, additional counsel may be hired to research specific areas of the law in your case This person would be considered the “research attorney”.

It is important to note that if another lawyer comes on board, it does not change the amount of recovery that you will receive should there be a settlement or jury verdict.  Your original lawyer will receive less, not you.

Expenses of Litigation

Expenses during litigation include things like:

  • Certified Fees for things like Police Reports
  • Copy costs for things like financial records to prove your lost wages
  • Filing fees at the clerk’s office
  • Deposition costs / court reporter fees
  • Expert witness fees for expert witnesses (like a doctor giving his opinion on the severity of your injuries).

Payment of these expenses are sometimes deferred until a later date; they are deducted from your recovery after your case has been settled or won at trial.

Your contingent fee agreement will outline the possible costs of litigation and how they will be deducted from your share of the recovery amount. Meaning, the payment of these expenses does not come out of your lawyer’s share of the recovery.

Court Reporters

Court reporters record the words that are said by the judge, the lawyers, and the witnesses, which then becomes “trial record.”

Specifically, they are expert stenographers who are entrusted with the transcribed record of the case during trial as well as transcriptions of testimony before trial.

They also assist in depositions. In their official capacity, they swear in witnesses and take down their testimony, as well as any objections made by the lawyers during the deposition. Everything that happens in a deposition is recorded in the deposition transcripts.

Court reporting services can be a big expense in an injury case that becomes a lawsuit and goes to trial. Additionally, if the case is appealed, then the entire “trial record” must be ordered to prepare the appellate briefs and arguments.

Typically, court reporters charge for the transcription per page, and charge an hourly fee for their appearance at a hearing or deposition.

Medical Liens

Health care providers generally understand the process when a personal injury claim has been filed. They know that the at fault person will ultimately be held responsible for compensating the victim for their medical expenses.

However, these providers will still take steps to make sure that their invoices are paid, and may file medical liens in order to do so.

These liens are filed in order to insure that the provider has a legal claim against the final recovery in the case. Under Florida law, a valid medical lien can be asserted against personal injury settlement funds or recovery proceeds.

However, if the medical provider does not file a medical lien, his or her invoice must still be paid in full.

What is a Closing Statement?

At the end of the case, you will be given an itemization of all the costs and expenses incurred during the course of your representation (a “Closing Statement”).

It will detail all the costs and expenses as well as the attorney’s contingent fee.  It will also tally how each item is deducted from the total recovery and show any costs that you do not have to pay.  Most importantly, the statement will provide you with the net recovery that you will receive.

Both you and your attorney will go over this itemized statement, and both of you must sign the Closing Statement before the proceeds can be distributed.

What Should You Do?

If you have been injured in an accident, then an experienced Florida personal injury lawyer can be very helpful in pursuing your claims for damages and in seeking justice for your harm.

A good piece of advice if you have been harmed as a result of someone’s negligence, is to speak with an experienced personal injury lawyer before you file a claim to learn about some of the issues that can arise with these claims, including the type of evidence needed to prove a claim and the procedures to lawfully recover certain evidence. Most personal injury lawyers, like Alan Sackrin, will offer a free initial consultation (over the phone or in person) to answer your questions.

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Do you have questions or comments? Then please feel free to send Alan an email or call him now at (954) 458-8655.

 

 

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