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What Goes Into Determining the Fees of a Personal Injury Attorney?

There is always a lot of speculation and rumor that circulates about how attorneys are compensated in each case. The first thing that people should know is that, while all Ontario lawyers answer to the Law Society of Upper Canada, there is very little control over what a lawyer can charge. The two situations where lawyers are regulated in how much they can charge are:

  • Cases involving disabled individuals
  • Cases where an attorney represents the interests of a minor

If your case does not fall under one of those two categories, then your lawyer can charge whatever hourly fee he wants. Some lawyers charge a flat hourly fee, and others charge a schedule of fees based on the activity that the lawyer has to engage in. Many lawyers will charge a premium for going to court, which would often be an additional charge on top of the standard hourly charge. If you picked your attorney because of his high profile on local television, then that may wind up making him more expensive as well.

However, the compensation arrangements with a personal injury attorney are a little different. Rather than charging any kind of flat rate, your personal injury attorney will usually take a percentage of the compensation that is awarded to you as a result of the case. When you put together a retainer agreement with a personal injury attorney, there are some stipulations that you should insist on. Those conditions include:

  • The attorney must spell out, in writing, what percentages he is charging for his various fees
  • The client must be involved in all decisions regarding the case
  • The compensation that is awarded needs to be paid to the client and not the attorney

As with hourly rates, a personal injury attorney can charge whatever percentage he wants to represent you. Some lawyers charge as much as 50 percent. But the agreement that you sign must spell out exactly what your attorney will be charging you for, and the percentages he will use when determining your bill.

Your personal injury attorney may charge you 40 percent, but it will be split up into various services. The three most common parts of a personal injury case are the claim, the partial indemnity and the expenses.

The claim is the actual financial award that you receive. When your attorney outlines the percentages he will be charging, this is where he will get his money from. If your retainer is 30 percent and you win $10,000, then your attorney gets $3,000.

The partial indemnity is a fee paid by the insurance company to offset your legal fees. This fee is usually around 10 percent of your total compensation. For example, the partial indemnity portion of the above mentioned case would be $1,000. That money gets added to your award, which would give you a total of $8,000 instead of just $7,000.

The expenses portion of the fees is something you will need to negotiate with your attorney prior to signing the agreement. Be sure that you completely understand where all of the expenses will come from and always scrutinize expenses when you pay your attorney’s final bill.

 

For assistance with a personal injury and/or insurance claim, please email David Himelfarb at dhimelfarb@himprolaw.com or call 1-855-446-7765, for a free case evaluation.

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