What does it mean when a lawyer is hired under a contingency fee? Do all lawyers operate this way?
A contingency fee is an arrangement between a lawyer and a client where the lawyer is paid a percentage of the recovery (i.e. money) the lawyer obtains for the client. Most lawyers do not accept contingency fees and are paid on a straight hourly rate, sometimes as high as $500 an hour, but typically $100 – $250 an hour. Many types of legal work (those cases where there is not a recovery) do not lend themselves to a contingency fee.
Contingency fees are most common in personal injury cases. Sometimes, the fee is on a sliding scale; for example, the lawyer will receive 25 percent if the case settles before filing the lawsuit, 33 and 1/3 percent if the case goes to trial, and 40 percent if the case is appealed. A lawyer may accept the case on a contingent fee basis but ask the client to pay a certain amount to cover some of the litigation costs.
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