How To Pay For Your Personal Injury Lawyer
September 8, 2008
You've been injured. You can't work. You have little or no income. You want to hire a lawyer to help you sue for damages arising from your accident including financial losses. But, you have no money. So, how are you going to pay the lawyer?
There is good news. Many personal injury lawyers will work on a contingency basis. When a lawyer takes your case on a contingency basis, you will not need to pay the lawyer anything up front. You will not pay anything until the end of the law suit, whether that is following settlement or trial. In true contingency fee agreements, you will not pay anything at all unless you win. Usually the lawyer will require that you sign an agreement setting out how the fees and disbursements (out-of-pocket expenses) are paid at the end of an action. Fees are usually 30% of the amount you recover at trial plus disbursements. It is common practice for the lawyer to take these fees and disbursements from the settlement check before you receive your share.
So who pays all of the expenses up front?
Personal injury lawyers often personally cover the up front litigation costs including filing and serving the court documents, obtaining medical records, retaining experts to provide medical-legal opinions, obtaining transcripts, witness fees, obtaining tax records, and any other fees associated with prosecuting the legal action. Often, by the time a case goes to trial the up front litigation disbursements can be up to $100,000 and sometimes even more. And this is not including the legal fees.
How do the lawyers cover all these expenses? Frankly, they have huge lines of credit. In addition, personal injury lawyers only take on cases that they trust will succeed at trial. It is true that some lawyers have gone broke funding actions that lose. It's a big risk and that is why personal injury lawyers are quite particular about the cases they will take.
If you're having a tough time finding a lawyer to take your case, it may be because the lawyers you have approached either do not do personal injury cases on a regular basis, your case is too big for their line of credit to support, or the lawyers do not believe you have a case that will win. If the lawyer you approach does not wish to take the case, ask why. And keep in mind that although one lawyer might not take your case on a contingency basis because it's too risky, there may be another lawyer who will take your case because the payoff in the end may be worth the risk.
The point is, if you have a case that is likely to win at trial, a lawyer will take your case without you paying anything up front.
There are a advantages when a personal injury lawyer takes your case and agrees to fund the up front expenses for you. The first thing is obvious...you don't have to pay anything out of your pocket. However, you also should know that when a lawyer is putting up so much of his own money, he'll want the action to progress as quickly as possible so that he gets his money back as quickly as possible. That means you'll get your settlement as quickly as possible too.
This may leave you wondering, 'If the lawyer wants his money back as quickly as possible, why in the world is it taking so long for my law suit to go to trial?'. This will be the topic of my next blog in one week.
Until then, be well.
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