Are Law Firms Altering Contingency Fee Agreements?

January 6, 2015 | Attorney, Matthew Dolman
Are Law Firms Altering Contingency Fee Agreements? It has recently come to my attention that some of my colleagues are adding a strange provision to their client contracts which I felt I should address. First, it should be noted, personal injury attorneys almost always work for a “contingency fee.” And, I only say “almost always” because while I've never heard of a personal injury attorney operating under any other type of fee agreement, I don't want to state definitely that it has never happened. The provision in question, essentially states that, in the event that an insurance company (or Defendant or tortfeasor) makes an offer to you, the Plaintiff or claimant, and you reject this offer against the advice of counsel, that the attorney will have the right to seek damages from you, their client, in the amount of the attorneys fee they would have received had you accepted the offer. In theory, such a clause would allow your attorney to sue you for money they would have made representing you. However, the attorney who gets a reputation for suing his clients is likely the attorney who will soon be on the bread lines. I find it unlikely any lawyer with the ability to think long would actually act on such a provision. So in practice, I think it is much more likely that such a clause would more likely act to pressure clients into accepting offers which they do not believe adequately make them whole. Such a provision is merely fear-mongering at its worst. Most of my clients are going through a lot while their case is ongoing. An attorney needlessly creating fear of legal action in the mind of a client is certainly not something a quality personal injury attorney would or ever should do. Worst of all, I'm not entirely certain such a clause is either legal or actionable. What is a Contingency Fee arrangement? At its most basic, a contingency fee is an agreement wherein the attorney agrees to accept payment for his or her services only if the client “wins.” Typically, “wins” does not mean “gets exactly what they wanted,” but instead something closer to “receives a settlement or verdict which pays them a sum of money.” Contingency Fee agreements allow for injured parties to receive legal representation without enduring an upfront an ongoing cost for their representation. Litigating a personal injury case through trial is an expensive undertaking, and were all Plaintiffs forced to pay the cost of representation, there'd be a sizeable disincentive to seek damages in a personal injury lawsuit. Additionally, Defendants and insurance companies would be able to drag out litigation in an attempt to freeze many Plaintiffs out and drain their resources in order to force them to accept a lowball settlement offer. Many personal injury claimants, were they forced to pay out of pocket for their representation with no guarantees or certainty that they'd receive any money for their claim or lawsuit in the end, would likely never proceed, or accept an offer that does not make them whole for the injuries. When does a Contingency Fee vest? So when does a agreed upon Contingency Fee “vest” or become due to the attorney? By its very nature, this fee arrangement requires something to occur in order to become payable. The client must make a recovery, whether that is via settlement or verdict. If a client never makes a recovery, even if they refuse an offer against the advice of counsel, then there can be no fee. If there were, the agreement would cease to be contingent on recovery, but would instead be contingent there being an offer made which the attorney believes the client should accept. I fear this would have a chilling effect on most Plaintiffs having their rightful day in court. No victim of negligence that seeks to obtain an award for damages they sustained due to the negligence of another should be put in the position I've described above. The Dolman Law Group Accident Injury Lawyers, PA offers its clients a true contingency fee agreement and is only paid if our client's make a recovery. The Dolman Law Group Accident Injury Lawyers, PA is able to provide zealous representation of injured parties that have been affected by the negligence of other drivers.  Contact us for a free consultation and case evaluation by calling 727-451-6900. Dolman Law Group Accident Injury Lawyers, PA 800 North Belcher Road Clearwater, FL 33765 727-451-6900


Matthew Dolman

Personal Injury Lawyer

This article was written and reviewed by Matthew Dolman. Matt has been a practicing civil trial, personal injury, products liability, and mass tort lawyer since 2004. He has successfully fought for more than 11,000 injured clients and acted as lead counsel in more than 1,000 lawsuits. Always on the cutting edge of personal injury law, Matt is actively engaged in complex legal matters, including Suboxone, AFFF, and Ozempic lawsuits.  Matt is a lifetime member of the Million Dollar Advocates Forum and Multi-Million Dollar Advocates Forum for resolving individual cases in excess of $1 million and $2 million, respectively. He has also been selected by his colleagues as a Florida Superlawyer and as a member of Florida’s Legal Elite on multiple occasions. Further, Matt has been quoted in the media numerous times and is a sought-after speaker on a variety of legal issues and topics.

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