When a lawyer in Louisiana offers to work on a contingency fee, that means that they’ll only get paid when they win the case and their client gets compensation for their damages. The aim of this arrangement is to encourage unfairly injured people to pursue their legal claims, even if they can’t afford to pay their lawyer upfront.
How contingency fees work
When a lawyer wins a case, like a personal injury claim, they’ll take a percentage of what they win, usually between 33% and 40%. The exact amount can vary by practice, and it may be helpful to agree upon that fee before the case proceeds. In most cases, the client will also have to pay for court costs, such as filing fees or expert witness fees. If the case is unsuccessful and the court awards the client no money, then both parties are generally not responsible for paying those costs.
To ensure fairness and transparency throughout the process, attorneys in Louisiana must adhere to certain State Bar rules when agreeing to contingency fee arrangements with their clients. That includes providing written contracts that detail all aspects of the agreement, such as how much they’ll charge in percentage terms and whether they intend to take out a loan on the client’s behalf to cover legal expenses. This way, clients will remain informed and have a clear understanding of what they’re signing up for throughout the process. Additionally, lawyers must keep detailed records of all time spent working on contingency fee cases, as well as any amounts received from those settlements.
Contingency fee variation
There are two types of contingency fee variations: hourly contingency arrangement and mixed hourly-contingent arrangement. The former is when the attorney bases their fees on an hourly rate, and the client pays a one-time fee for legal services if they win. The latter is when lawyers charge both an hourly rate and receive a portion of any award or settlement as their contingency fee.
Contingency fees appear enticing when you don’t have enough funds upfront for your attorney, but they may also come with some drawbacks. For one, you can end up paying the attorney more than what you would have given them before starting the case. Secondly, since attorneys get nothing if they lose, your case must be strong enough for them to consider it.