The cost of hiring a personal injury lawyer in Texas may be a primary concern of an injured person who has been hurt in an accident. Most Texas personal injury lawyers take personal injury cases on a contingency fee basis, meaning that the lawyer’s fee will generally be based upon the recovery achieved in the case rather than being charged to the client as an hourly legal bill.
Understanding how contingency fees work can help an injured person to ask the right questions before hiring a lawyer and what expenses may be deducted from a settlement or judgment.
At the Cain Firm, we represent injured Texans in personal injury matters, including car accidents, truck accidents, motorcycle accidents, premises liability cases, and wrongful death actions.
Important Notice: Each attorney-client fee agreement is different. The terms of a contingency fee agreement, including the calculation of attorney fees and case expenses, should be clearly stated in the written fee agreement.
What Is a Contingency Fee in a Texas Personal Injury Case?
Contingency fee is a type of fee agreement where the lawyer’s fee will depend on the success of the case. Unlike in an hourly fee agreement where the lawyer charges an hourly rate for each hour of his/her work, the contingency fee agreement provides how the lawyer’s fee will be calculated if there is a recovery in the case.
Generally, in a typical personal injury case, the lawyer may get an agreed percentage of the recovery if the case leads to a settlement or judgment.
The fee agreement should disclose the formula to calculate the lawyer’s fee and handling of the litigation and other expenses. The Texas Rules of Professional Conduct address contingent fee agreements and require such fee agreements to be in writing.
Does a Contingency Fee Mean I Pay My Lawyer Up Front?
Not necessarily. The contingency fee agreement works in a different way from the hourly fee agreement because the lawyer’s fee will generally depend on the recovery in the case.
However, a client shouldn’t assume that having a contingency fee means that there will be no expenses associated with a case. Litigation expenses and other case expenses can be treated differently according to the agreement.
Before signing a representation agreement, ask:
- How is the lawyer’s fee calculated?
- Is the percentage different if the case is settled, tried, or appealed?
- What kind of litigation expenses may be incurred?
- Who is responsible for the expenses?
- Are the expenses deducted before or after the lawyer’s fee is calculated?
- What happens if there is no recovery?
The answers should be reflected in the written fee agreement.
How Does a Contingency Fee Work?
A contingency-fee arrangement generally involves several steps.
1. You Discuss Your Case With an Attorney
The process starts with a consultation. The lawyer analyzes the facts of the injury, potential claims, evidence, insurance coverage, and other issues which may arise in the case.
Each injury claim is not the same. Therefore, each contingent fee agreement should depend on the facts of the particular case.
2. You Review and Sign a Written Fee Agreement
If the lawyer agrees to represent you under the contingent fee agreement, then the terms of the representation should be put in writing.
According to Texas Rules of Professional Conduct, a contingent fee agreement should disclose the formula to calculate the lawyer’s fee. If different percentages apply in case of settlement, trial, or appeal, then these percentages should be stated in the agreement. In addition, the agreement should disclose how the litigation and other expenses will be handled.
3. The Attorney Handles the Legal Claim
With the start of the representation, the lawyer will analyze the accident, collect evidence, communicate with insurance companies, evaluate your damages, negotiate with the other side and, when appropriate, file and try the case.
The nature of work can be very different depending on the nature and complexity of a personal injury claim.
4. The Case May Resolve Through Settlement or Litigation
A personal injury case may resolve through a negotiated settlement or proceed through litigation.
The fee agreement should explain whether the attorney’s percentage changes depending on the stage at which the case resolves. Texas rules specifically require different percentages for settlement, trial, or appeal to be stated when applicable.
5. The Recovery and Expenses Are Calculated
If there is a recovery, then the lawyer’s fee and other expenses will be calculated according to the written agreement.
Upon completion of the contingent fee representation, Texas Rule 1.04 requires the lawyer to prepare a written statement disclosing the results and, in case of recovery, showing the amount remitted to the client and the formula to calculate the fee.
What Percentage Do Personal Injury Lawyers Charge in Texas?
There is not one common percentage for all Texas personal injury cases.
The fee will depend on the lawyer-client fee agreement and the circumstances of the case. The fee will be affected by the type and complexity of the case, work required, stage of the matter, etc.
Since the fee agreements can differ, it is crucial to carefully read the fee agreement rather than assuming one particular fee disclosed elsewhere.
If the attorney advertises a specific fee or a range of fees, Texas advertising rules impose certain requirements concerning such advertised fees.
What Expenses Are Separate From the Attorney's Fee?
The lawyer’s fee and the case expenses are not the same.
Depending on the case and the fee agreement, the expenses can be treated as expenses of the investigation and pursuit of the claim. These expenses can include:
- Court filing fees
- Records and documents fees
- Expenses related to the expert
- Deposition expenses
- Investigation expenses
- Other litigation expenses
The important question is who is responsible for these expenses and when they are deducted.
Texas Rules of Professional Conduct require the contingent fee agreement to disclose the litigation and other expenses that will be deducted from the recovery and to state if the expenses are deducted before or after the contingent fee is calculated.
Are Case Expenses Deducted Before or After the Attorney's Fee?
This will depend on the written fee agreement.
For example, the formula of calculation can provide different net amounts depending on whether the expenses are deducted from the recovery before the lawyer’s fee is calculated or after the lawyer’s fee is calculated.
That is why a client should not simply rely on the percentage stated in a contingency fee agreement. It is important also to understand how the fee will be calculated and handled.
What Happens If There Is No Recovery?
This is an important question to ask before making any contingency fee agreement.
The answer will depend on the particular agreement. Clients should carefully review the fee agreement in order to understand what will happen to attorney fees and case expenses in case there is no recovery.
Don’t assume that every personal injury lawyer follows the same procedure.
Can a Personal Injury Lawyer Charge Different Percentages for Settlement and Trial?
Yes, a contingent fee agreement can provide different percentages in case of settlement, trial, or appeal.
Texas Rules of Professional Conduct explicitly address this issue. According to Texas Rules of Professional Conduct, if different percentages apply for settlement, trial, or appeal, then these percentages should be stated in the written fee agreement.
That is why it is important to understand not only the initial percentage, but also whether the percentage changes if the case goes further.
What Should I Look for in a Texas Contingency-Fee Agreement?
Before signing a representation agreement, it can be helpful to ask the lawyer to explain:
The Attorney's Fee
To understand exactly how the lawyer’s fee will be calculated and if different percentages apply to different stages of the case.
Case Expenses
To find out what expenses can be incurred in the course of the case and whether they will be your responsibility according to the agreement.
The Calculation Method
To understand whether the expenses are deducted before or after the lawyer’s fee is calculated.
Settlement Authority
To understand how the settlement of the case will be made. Your lawyer can provide you advice regarding the settlement, but you should understand your authority regarding the settlement.
What Happens If the Case Ends Without a Recovery
You should ask specifically what happens to lawyer’s fees and expenses if the case ends without recovery.
Other Lawyers or Law Firms
If another lawyer or law firm will be involved in the representation, then you should ask how it will affect your fee. Texas Rule 1.04 includes special provisions for division of fees between lawyers who are not in the same firm, including a written client’s consent in certain situations.
Is a Contingency Fee Worth It for a Personal Injury Case?
Whether a particular fee agreement is appropriate will depend on the circumstances of a particular case.
Contingent fee can enable an injured person to hire a lawyer without paying an hourly legal fee during the entire representation. However, the client should understand the terms of the agreement, including the lawyer’s fee, expenses, and formula of calculation.
The goal is to understand the agreement before signing it.
When Should I Contact a Texas Personal Injury Lawyer?
If you have been hurt due to the negligence of another person, it can be helpful to discuss your case with a Texas personal injury lawyer as soon as possible.
Evidence may become harder to get with passing of time, and there may be deadlines for filing a personal injury claim. Generally, Texas imposes a two years statute of limitations for most personal injury claims; however, there are exceptions and different deadlines for other types of cases.
Therefore, since deadlines may affect your rights, you should not rely on one deadline without consulting a qualified attorney.
Frequently Asked Questions About Texas Personal Injury Contingency Fees
Do I have to pay a personal injury lawyer before my case is resolved?
Not necessarily. Personal injury lawyers can offer contingency fee agreements where the lawyer’s fee will be dependent on the recovery in the case. The terms of the agreement can vary from attorney to attorney and from case to case. These terms should be set forth in the written agreement.
Do I pay attorney fees if my personal injury case is unsuccessful?
The answer will depend on the particular agreement. You should ask the lawyer what will happen to the fees if there is no recovery in the case.
Are medical bills included in a contingency fee?
Medical bills are generally not a part of the fee agreement. Depending on the circumstances, the medical providers, insurers, or other parties may have some claims and reimbursement rights regarding the recovery. Your lawyer can explain how these claims will affect your particular case.
Does the contingency percentage include court costs?
Not necessarily. Lawyer’s fees and litigation expenses are separate issues, and the written agreement should disclose how the expenses will be handled. Under Texas advertising rules, any advertisement that discloses the lawyer’s willingness to provide legal services on a contingent fee basis should disclose whether the client will be responsible for other expenses, like litigation costs.
Can the contingency fee change if my case goes to trial?
It can, depending on the written agreement. If different percentages apply for settlement, trial, or appeal, then these percentages should be set forth in the contingent fee agreement.
How do I know how much money I will receive from a settlement?
The amount of money a client will receive will depend on the recovery, the lawyer’s fee according to the agreement, case expenses, and other issues that may be necessary to solve.
Your lawyer should explain the calculation and prepare a closing statement in the end.
Talk With a Texas Personal Injury Lawyer About Your Case
If you or your family member has been hurt in an accident, understanding your legal options and the costs of the representation is the first step.
The Cain Firm represents injured Texans in personal injury matters across Texas, including the Dallas-Fort Worth Area, Fort Worth and Granbury. We handle car accidents, truck accidents, motorcycle accidents, premises liability, wrongful death and other personal injury claims.
A consultation will give you an opportunity to discuss the facts of your injury, possible legal claims, and representation terms applicable to your case.
Contact the Cain Firm to discuss your Texas personal injury case and our representation and fee agreements.
Legal Disclaimer
The article is provided for general informational purposes only and does not constitute legal advice. Each personal injury case is different, and the outcome of any legal matter depends on the particular facts and applicable law. Reading this article does not establish an attorney-client relationship between you and the Cain Firm. No representation is made that the quality of legal services to be performed is greater than the quality of legal services performed by other lawyers.
If you have any specific legal question, please consult a qualified Texas attorney regarding your circumstances.
Attorney responsible for this content: Brett Cain
Primary practice location: Fort Worth, Texas
