Everything You Need to Know About Fees

Hiring an attorney might seem like something that’s only for people with lots of extra cash. While in some cases that might be true, it’s definitely not the case for Morgan & Morgan. 

Receiving compensation for an injury that wasn’t your fault should be possible for everyone. Especially when those at fault have the financial backing of multimillion dollar insurance companies, resources that you don’t. So here’s everything you need to know about the costs for an injury claim. 

An Overview 

There are many different types of fees a firm may choose to use: hourly, contingency, flat, or retainer. 

Some of these arrangements require upfront payments (such as a flat or retainer fee) and others can build up quite quickly (hourly). It also may mean that the more time your attorney puts into your case, the more is spent on their services and less is left for you. 

There’s only one type of fee structure you need to worry about here: the contingency fee. 

A contingency fee requires zero upfront spend and there’s no cost if your claim isn’t successful. It’s an outcome-based fee, meaning that you only pay your attorney if they win. 

This is beneficial for a few reasons. It means equal access to justice for all: you don’t have to have extensive financial resources to file. It also means that you and your attorney have the same motivations: because payment is only received if the case is won, you know that your attorney will be spending the time, resources, and expertise to get you the best possible results. 

When a case is resolved, you’ll receive a closing statement. This statement breaks down your award money and all the fees and costs associated with your case. It must be signed by you and your attorney, and the funds are typically available to you 7-10 business days later. 

Here’s how it works. 

Transparency is key. A closing statement will have multiple line items that specify exactly what’s being deducted from your award. 

Attorney Fee

First is the attorney fee. This is a percentage of the settlement or verdict that’s been agreed to in the retainer agreement (contract) you signed when you first hired your attorney. It can vary based on location and whether or not the claim goes to trial. Certain cases might have a percentage that is set by the federal government, like workers’ compensation claims. 

Sometimes, the percentage may also vary based on the final amount won. For example, if it’s over a certain number (say, a million dollars), the attorney fee percentage gets lower for each additional million won. It’s sort of like income tax brackets, but in reverse. 

Case Costs 

Next are any expenses involved in the filing of your case.  For example, obtaining medical records or reports, court filing fees, retaining expert witnesses and consultants, and more. 

Liens

There are two different types of liens that may be on your closing statement. 

• If you are covered by health insurance, your provider will pay medical expenses (according to your plan) for your injury. When a personal injury claim is successful, a certain amount of the award is dedicated to medical costs. 

Your health insurance will therefore get paid back for the coverage they provided out of your award money. You’ll see this on your closing statement as “liens”. Not to worry, if the case doesn’t have a positive resolution, your provider will still cover those costs as previously agreed. 

• You may also have a personal lien. Personal injury cases take time. You might need money today when compensation can take months or even years to arrive. Financial institutions might loan you that money to be paid back when the claim is resolved. 

Bear in mind that the agreement for these funds is between you and the lender. These are not considered part of the contingency fee arrangement you have with your attorney. 

Medical Expenses 

There may be outstanding medical costs for your injuries. Often, your personal injury attorney will help you negotiate those costs to get you the best possible rate. Since you can’t get paid until your medical debts are resolved, you may see the phrase ‘hold in trust’ on your statement. 

That just means that the firm will hold onto the funds for the current cost of the medical expenses while they’re being negotiated. This way, you can still get a check as that’s being figured out. If the medical costs do get reduced, you get the extra money back! 

Delayed Cost Deposit 

Remember the second line item? Costs associated with your case? There might be some left at the time of your closing statement. To pay you as quickly as possible, your attorney might hold onto a small deposit to pay any last-minute invoices. Whatever isn’t used is released after a set time period, usually 90 days. 

Your Check Amount 

Then comes your final award amount! This is the amount of money that will be paid directly to you, through a check or direct deposit. In most cases, personal injury awards are tax free. 

Always be sure to read your retainer agreement or any contracts carefully. If anything is unclear or you have any questions about the costs associated with your claim, always ask!