Parameters of this Legal Advise

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Question: How do most attorneys charge fees?

Answer: There are two primary ways that attorneys charge. Hourly and contingency. Hourly fees will be charged for the attorney as well as law clerks and paralegals. Secretary and receptionist time is generally included in the fee charged by the attorney, which is part of what makes the hourly fee rate seem so high.

When the attorney quotes a fee of $225.00 per hour or more, that fee must pay for the office rent, telephones, law books, secretary and receptionist salaries, insurance, copiers, and all the rest of the office overhead.

Contingency fee is a percentage of the settlement or judgment obtained going to the attorney for the fee. It is called that because payment is "contingent" upon the attorney obtaining money in hand for the client. Only upon obtaining the money does the attorney earn a fee. Injury claims are usually taken for a one-third contingency fee, although twenty-five percent is common if the claim is relatively simple or unusually large. Fees of up to forty and even fifty percent may be required if the claim is unusually difficult or complex or if the matter goes to litigation.

After the claim is settled and the money obtained, the attorney will calculate the amount of "costs" incurred, deduct those and repay himself, and the balance will be split with the client in accordance with the agreed fee arrangement. "Costs" are such items as unusual travel expenses, court filing fees, court reporter fees for depositions, and expert witness fees. These fees can become quite high in some cases, and usually the attorney forwards most if not all of these costs.

Flat fee: Most attorneys refuse to charge a flat fee because legal matters are rarely predictable in nature. Some matters that lend themselves to flat fees are uncontested divorces, bankruptcies, and simple matters such as wills, name changes and the like.



Phone: (916) 391-8000, 446-2501
Email to: mike@mtracylaw.com