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How A Contingency Fee Works In A Baltimore Personal Injury Case.

“Contingency fee” is the common nomenclature used to describe the financial arrangement between a Baltimore personal injury lawyer and car accident victim. The Baltimore personal injury lawyer and the injured client agree to a fixed percentage to be paid from any financial recovery. If there is no recovery, there is no fee. This seems, and in-fact is, incredibly straightforward. The application of the arrangement moreover provides truly vital benefits for the client. The beneficiary/client is saved from the requirement of paying attorney’s fees and litigation costs upfront or out-of-pocket. Significantly, the beneficiary/client is also spared the financial pain of an unsuccessful, or less-than-successful, case. In other words, if there is no recovery in the case, the client owes nothing. The attorney has worked for free and has advanced the costs of any litigation in vain. It is this gift bestowed on the injury victim -that of risk-free, and no-consequence legal representation- that is the hallmark of the contingency fee arrangement.

It makes some sense to peel back the layers and take a deep dive into an analysis of how a contingency fee works in a typical Baltimore car accident case. The starting point, of course, is for the lawyer and the prospective client to come to terms. In a contingency fee case, that would mean agreeing upon a percentage that would be withheld from any financial recovery and apply on account of attorney’s fees. As a matter of note, there are other fee arrangements available, such as hourly arrangements, where the client agrees to pay the attorney a given amount for each hour expended on their personal injury case, or, flat-fee, where the client agrees to pay the personal injury lawyer a fixed sum for representation in their injury matter. You should always discuss the possibility of these arrangements with your chosen Baltimore personal injury counsel. Also notable is that the percentage agreed to buy an attorney varies from practice to practice and jurisdiction to jurisdiction. In Baltimore Maryland, it is common for a personal injury lawyer to retain 1/3 of any pre-suit settlement, and 40% of any settlement or verdict after a lawsuit has been filed and the claim has proceeded to litigation.

I offer my Maryland clients a reduced attorney fee program. I offer my Maryland clients a reduced attorney fee program. This arrangement has been in place for some 15 years now, and has saved my Maryland clients thousands of dollars in attorney fees.  Under this arrangement, the percentages are limited and lesser than those found typically in the community. Learn more about the details of this exciting program.

EXAMPLE: By way of illustration, let’s imagine a hypothetical situation, where an individual is involved in an automobile accident in Baltimore City Maryland, and sustains significant, although not permanent or disabling, injury. This injured person receives a course of physical therapy that has been recommended by a doctor after evaluating them for their injuries. They went to an urgent care clinic immediately after the accident. Their medical bills total $3500. They had to miss a week of work losing $800 in income. This is the type of claim that would have about $4300 in economic damages, based on the hypothetical facts. The injured person is also entitled to non-economic damages in our hypothetical scenario. Although there were negotiations, the insurance company never offered more than $4000. Accordingly, the diligent and competent personal injury, attorney in our scenario files suit in Maryland District Court, and, after trial is able to obtain a reasonable $10,000 verdict for the client.  Under the contingency fee agreement in this hypothetical scenario, this attorney is entitled to receive 40% of that $10,000 judgment as his or her attorney’s fee. By way of further illustration let’s assume that in that same scenario, the contingency fee agreement called for the attorney to receive 33% of any settlement occurring prior to the filing of a lawsuit. In our example, had the facts been different, and the insurance company negotiated reasonably and offered that same $10,000 prior to the filing of the lawsuit, the attorney would’ve received a fee of $3300 or 1/3 of the $10,000 settlement. Finally, let us assume a more unfavorable outcome for this case. The assumption we are making here is that the claim was presented at trial, but a judge found that the injured person was in fact contributory negligent and therefore not entitled to any recovery whatsoever. Let’s also assume that in this less fortunate hypothetical outcome, the attorney had paid for the filing fee, the service of process fee, and several hundred dollars in costs to obtain the client’s medical records and other miscellaneous matters. In this situation -that is to say where a court finds against the injured person- and there is no financial recovery, the client is spared having to pay his or her lawyer anything or reimburse his or her chosen personal injury counsel for the cost advanced on his or her behalf. It is truly in this latter example that the true beneficial, almost benevolent, nature of the contingency fee arrangement comes to the fore. It allows a client with a legitimate and meritorious, but nevertheless, litigable and uncertain claim to obtain services or a skilled, seasoned personal injury litigator at no upfront cost. Under such an arrangement, the skilled litigator they’ve chosen is also willing to advance costs and bear the fall risk of any negative outcome.