What is a Contingency Fee?

Most medical malpractice attorneys charge at least a 40% contingency fee to handle medical malpractice cases. A contingency fee means that the lawyer does not get paid unless a recovery is made. In other words, the lawyer's fee is contingent upon getting a recovery.

In routine personal injury cases, a typical contingency fee is 33 1/3 % of the recovery. Medical malpractice contingency fees are higher because they are much riskier and require the investment of substantially more money and time than the average personal injury case.

The lawyer charges his fee on the total amount recovered. Thus, in a case where the lawyer recovers $100,000 for his client, the lawyer's fee would be $40,000 or 40% of $100,000. This is the lawyer's fee for his time and effort. In addition to the lawyer's fee, the client is also obligated to reimburse the lawyer for any out of pocket expenses incurred in prosecuting the successful case.

In the above example, a client would pay the lawyer a $40,000 fee plus his out of pocket expenses. The expenses are paid out of the remaining $60,000 the client recovers.

Frequently Asked Question

Many people ask the question why do the expenses come out of the client's portion of recovery instead of the lawyer's portion of the recovery? The answer is simple. If the lawyer was reimbursed his expenses out of his portion of the recovery, and the case expenses were high, he would have taken all of the risk, performed all of the work and received little or nothing in return. He would have effectively acted as a bank to finance the case without compensation for his time. The only service a lawyer offers is his time and he must be compensated fairly for it.

This explanation raises the question that if the lawyer takes 40% of the recovery and the experts must be paid large sums from the patient's recovery, the patient will then recover almost nothing. This is true in cases where the damages do not exceed $150,000. Thus, unlike most personal injury cases, medical malpractice cases should not be undertaken if the damages are not at least $150,000 and significant time and expense is required.

In short, contingency fees must reflect the degree of risk and the time and expense involved in handling medical malpractice cases. Remember, even if the lawyer spends $50,000 of his own money on the case and you lose, you owe the lawyer nothing. On the other hand, lawyers who defend cases get paid whether you win or lose.