Demystifying Lawyer Fees: Understanding the Costs of Personal Injury Cases
What makes contacting an attorney for help so intimidating? For many, the answer is attorney and legal fees. When you don’t understand how attorney fees are determined or the difference between a lawyer’s fees and legal costs, you may be uncomfortable seeking legal help.
At Stewart Law Offices, we can demystify lawyer fees and explain the cost of personal injury cases. Call us today for a free consultation to learn about how our personal injury lawyers can seek compensation for you with no money upfront.
How Are Attorney Fees Determined in North and South Carolina?
In North Carolina, lawyers must follow specific rules outlined in the Rules of Professional Conduct set forth by the North Carolina State Bar to set their rates. These rules of conduct specify how an attorney can establish and collect fees from clients, among other legal duties. An attorney may charge rates in line with their level of experience and knowledge. More experienced lawyers often charge higher fees than less experienced lawyers.
The Rules of Professional Conduct in North Carolina also clearly outline that attorneys cannot charge or collect excessive fees for the expenses or work put into a case. Factors that can influence whether a fee is excessive in North Carolina include:
- Time and labor required to perform the specific legal service
- The fees customarily charged in the area for similar legal services
- The amount of money involved and the results obtained by the attorney
- The nature and length of the client-attorney relationship
- The experience, reputation, and abilities of the lawyer performing the service
- Whether the fees are fixed or contingent
In South Carolina, the Rules of Professional Conduct for attorneys are much the same. They also outline fees based on the scope of representation, the division of fees between lawyers who are not in the same firm, and the charging of advance fees in some types of cases. Each state bar has the power to discipline lawyers who violate fee rules, including taking away the lawyer’s license to practice law.
What Is a Contingency Fee?
A contingency fee arrangement occurs when an attorney or firm agrees to provide a client with legal representation and conditions their fee upon their case’s successful outcome. The client pays no legal fees upfront. Instead, the lawyer’s fee is typically an agreed-upon percentage of a client’s compensation that is paid to the attorney when the client receives a final settlement or award. If an attorney does not win a settlement or verdict on behalf of their client, no attorney’s fees are due.
Contingency fee arrangements are common in personal injury cases where a client seeks compensation for injuries and financial losses caused by another party’s wrongdoing, such as lost wages and medical bills. This is a payment structure that many personal injury victims appreciate because it allows accident victims to obtain legal services without any added financial burden. When personal injury attorneys work on a contingency basis, the victim can protect their rights and pursue legal action without having to pay attorney fees upfront. They only pay if their personal injury claim has a favorable outcome.
When a client receives a settlement or verdict in their favor, the insurance company or defendant sends a check to the attorney’s office. The lawyer first pays any liens related to the case, such as outstanding medical expenses. Next, the attorney pays their own firm any case-related expenses and then takes their attorney fees based on the contingency fee arrangement. The client receives the remainder of the money.
Contingency fees can vary depending on the amount of work needed to resolve the case. For example, some attorneys receive 33 percent of a client’s award if the case settles out of court but upwards of 40 percent if the case goes to trial. Preparing a case for court and trying it before a judge or jury takes significantly more time and preparation than negotiating and reaching a settlement out of court. The percentage is outlined in a written fee agreement.
There are different fee structures attorneys may use. For example, some attorneys charge a flat rate. This is a fixed fee for their services, regardless of how much time they spent on a case. Alternatively, an attorney could choose to charge an hourly rate for their services. Hourly billing arrangements are directly tied to the time an attorney spends working on a case. Hourly rates can vary depending on location, experience, type of case, and reputation. Hourly rates are due regardless of the outcome of the case.
Lawyers may also request advance fees, sometimes called retainer fees, in specific cases. An advance or retainer is a fee paid upfront to an attorney as a down payment on services. As the case progresses, the lawyer’s billable hours are subtracted from the retainer. When it’s gone, the lawyer can request an additional retainer or bill the client for actual hours worked as they happen. This is in addition to any other expenses related to the case the attorney bills for.
Because there are various fee structures charged in the legal industry, it is important you understand them so you can make an informed decision about what type of fee arrangement to enter into. At Stewart Law Offices, we do not want for you to forego receiving the legal representation you need during this challenging time, so legal services provided by our personal injury attorneys are on a contingency fee basis. You don’t have to pay us any fees upfront, and we can get started immediately.
Attorney Fees Vs. Legal Costs
There is a lot of confusion surrounding attorney fees and legal costs in personal injury claims. What you pay an attorney to work on your case is not the same as what you must pay an attorney for legal expenses associated with working on your personal injury case. Attorney fees account for the time and effort an attorney puts into organizing an individual’s case and representing them.
Legal costs are separate from attorney fees. An attorney may incur costs and expenses on behalf of a client when preparing a claim or case. It is common for an attorney to bill these additional costs directly to the client, in addition to attorney fees outlined by the attorney’s fee agreement.
Some of the most common legal costs involved in personal injury cases that are passed along to a client can include:
- Copy fees
- Postage fees
- Court filing fees
- Courier fees
- Witness fees
- Fees to obtain your medical records
- Travel expenses
- Expert witness fees
- Court reporter costs
Potential clients can discuss an attorney’s fee structure and any anticipated legal costs associated with their case in the initial consultation to get a better idea of what to expect.
Contact an Experienced Personal Injury Attorney for Help
At Stewart Law Offices, our compassionate legal team understands the financially challenging position you may be in after an accident caused by a careless individual. We work on contingency so you won’t pay upfront costs. Discuss your situation with a personal injury lawyer from our legal team today during a free case consultation. We will work tirelessly to obtain fair compensation on your behalf.