Attorney wants 40% of settlement for doing nothing?

by Carol
(Canoga Park, CA)

This attorney was hired on a contingency fee basis for a personal injury case. He advised the client that they should contact the insurance company and try to settle case. The client found another attorney within 2 weeks. The case has since been settled by the client, 3 years after the start of the case.

The first attorney, who did NOTHING, only spent 2 weeks with client and then was fired, NOW WANTS 40% OF THE SETTLEMENT!! What should I do? This doesn't seem right at all. How can I defend this? The settlement was very small. Thank you.

Visitor Question:
Disclaimer: Information provided in our response is NOT formal legal advice. It is generic legal information based on the very limited information provided. Under no circumstances should the information in our response, or anywhere else on this site be relied upon when deciding the proper course of a legal matter. Our response does NOT create an attorney-client relationship. Always get a formal case review from a licensed attorney in your area.

ANSWER for "Attorney wants 40% of settlement for doing nothing?":

Carol (Canoga Park, CA):

When a client signs a contingency fee agreement with an attorney, the client is agreeing to pay the attorney only if the attorney settles the case or wins it at trial. Thereafter, if the primary attorney refers the case to a secondary attorney, or the client dismisses the primary attorney, the contingency fee agreement will follow the case to the secondary attorney.

It is unlikely the primary attorney will be receiving 40% of the entire settlement. Instead, it is more likely the secondary attorney will split his or her contingency fee with the primary attorney. In any event, the most the client will be required to pay is up to 40% of the settlement amount.

In most contingency fee agreements, attorneys are entitled to anywhere from 33⅓% to 40% of the settlement amount; 40% is usually reserved for cases which go to trial due to the increased time and expense required. Clients should know this at the start, before signing the fee agreement, and are then free to retain the attorney or consult with others.

Personal injury attorneys pay all costs of the case in advance. They do so knowing they may receive nothing if they fail to settle or win the case. As a result, they are entitled to be paid for their services. If they don't settle or win the case, the client owes nothing, and the attorney is out all the amounts he or she paid.

The above is general information. Laws change frequently, and across jurisdictions. You should get a personalized case evaluation from an attorney licensed in your state. Find a local attorney to give you a free case review here, or call (888) 647-2490.

Best of luck,

Judge Calisi

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TYPE OF ACCIDENT
AUTO ACCIDENT
PERSONAL INJURY
WORKERS COMPENSATION
MEDICAL ERROR
YES! I WANT FAIR COMPENSATION