A contingency agreement is a legal contract that outlines the terms and conditions of financial arrangements between two parties. This type of agreement is common in the legal industry, particularly in personal injury cases.
In a contingency agreement, the attorney and client agree that the attorney will only be compensated if the client receives a settlement or monetary award. This means that the attorney will take a percentage of the amount awarded to the client as compensation for their services.
The percentage that the attorney takes can vary based on a number of factors, such as the complexity of the case or the amount of work required. Typically, contingency fees range from 33% to 40% of the total amount awarded.
Contingency agreements can be beneficial for clients who may not have the financial resources to pay for legal representation upfront. By entering into a contingency agreement, clients can obtain legal representation without having to pay any out-of-pocket expenses.
However, it is important to carefully consider the terms of a contingency agreement before signing. Clients should be aware of the percentage of the award that will be taken by the attorney, as well as any additional fees that may be incurred.
In addition to personal injury cases, contingency agreements may also be used in other legal matters, such as employment disputes or breach of contract cases.
In summary, a contingency agreement is a legal contract that allows clients to obtain legal representation without upfront payment. However, clients should carefully review the terms of the agreement and consider all associated fees before signing.