Contingency Fees

View the video below with Reed & Mansfield Partner Daniel Reed for more information on contigency fees.

One way lawyers or attorneys charge fees is through what is called a "Contingency Fee".  A "contingency fee" means that the lawyer gets a percentage of the money he or she recovers for the client. The fee is "contingent" upon the lawyer winning money for the client. If the client gets nothing, neither does the lawyer. 

Broadly speaking, there are also two types of contingency fees:

  • Flat Percentage Rate or Flat Contingency Fee: Stays the same regardless of whether the case settles without filing suit or going to trial.
  • Escalating Contingency Fee: The fee may increase if it is neccesary to file suite and may increase again if it is tried. For example, the fee might be 33.33% if settled w/o filing suit and 40% if it is necessary to file suit and 45% if it is tried and 50% if there is an appeal.

At Reed & Mansfield, in motor vehicle cases where liability is NOT disputed, we use a flat 25% contingency fee and in all other personal injury cases we charge 1/3 (33.33%) if we settle the case without filing suit and 40% if we have to file suit or try the case. 

Typically, the contingency fee is calculated on the total settlement or verdict. For example, a 25% on a $100,000 case would be $25,000. Of the remaining $75,000, some money might go to pay back costs and medical liens.

Reed & Mansfield Case Example:
To give an example from a recent case we handled, of a $1,900,000 settlement, $475,000 was the 25% fee, $30,007 was repaid to us for costs, $61,667 was paid to lien holders and the rest went to the client. Most of the costs in this case were for high-priced experts to give us reports on such things as:

  • How would the client's injuries affect him over his life? (Orthopedic surgeon)
  • How would the client's injuries affect his earning capacity for the rest of his life? (Vocational Expert)
  • How much would future care cost? (Care Costs Expert) 
  • How should future care costs be adjusted for things such as future inflation? (Economist)

In this case we paid an orthopedic surgeon over $9,000 to examine the client and offer his opinion as to how much bone damage was permanent.

Large Cases
In the majority of large cases such as the one above it requires that a suit be filed and prepared for trial even if they settle. It's just too hard to get a decision maker at an insurance company to agree to big payout unless they are convinced that the Plaintiff's lawyer has spent the time and money to prep the case well for trial. Smaller cases, from the low six figures and down, especially motor vehicle accident cases, usually settle without filing suit and in such cases the costs are often trivial, sometimes just a few dollars for medical records.

Controversial Area:
What happens if the costs and medical liens are so large that they really eat into the Plaintiff's recovery? This can be a controversial area with contingency fees.

Some cases are "poisoned" at the outset by large medical liens. For example, in a car accident case if there is only $15,000 in insurance available and the adverse driver has no assets and there is a hospital lien for $60,000 and the victim has no health insurance we are just going to tell the prospective client at the outset that we see no way to put any dollars in their pocket. We are not going to take the case just so we can pocket a fee. However, what if there is $100,000 in insurance available and the most we can get the liens down to are $60,000? In that case rather than take a 25% fee of $25,000 and leave the client with only $15,000 we would reduce our fee so that we would split the remaining $40,000, fifty-fifty with the client, thereby taking a $20,000 fee.

Personal injury clients should ask attorneys what they would do in such a situation before signing a retainer agreement.

Hourly Fees

The straight hourly rate typically includes a retainer to cover several hours paid for up front. An hourly fee is typically charged for business, contract and all matters where the client is the defendant in a civil case. Criminal defense is typically carried out at an hourly rate of flat fee.

The hourly rate charged by our firm, like many other firms, depends on the complexity of the work and which specific lawyer handles it. Another complication with an hourly rate is whether there will also be hourly charges by paralegals or by more than one attorney. Although our firm tries to avoid hourly fees if there is another reasonable alternative, there are lawyers we compete with and admire who charge an hourly fee, are great, and bill fairly and reasonably. Although unusual, occasionally affluent clients who can pay a monthly bill will contract with personal injury attorneys to work on an hourly fee.

We don't like hourly fees because the time it takes to get a job done can often vary greatly due to factors beyond the control of the lawyer and client. If the work gets done faster than usual on a hourly fee the lawyer is a great guy. If the work gets done slower than usual on an hourly fee the lawyer is a dishonest bum. With a flat fee or contingent fee, the client knows upfront what the fee will be and if takes longer than usual that's the lawyer's problem and if goes faster than usual, that's to the lawyer's benefit. In a worst case scenario hourly fees reward inexperience and incompetence.

Flat Fees

The third type of fee is a flat fee. In our uncontested probate cases we offer a flat rate and seek to compete for your business as the high quality, low cost probate lawyers in Las Vegas, Nevada. See our legal fees for Probate on our Probate Nevada website.

Many clients are afraid that lawyers who charge by the hour will take advantage of them. This is an additional reason we try to offer flat rates for uncontested probates and many other matters.


Whether the attorney charges a flat fee or an hourly fee, the attorney will usually charge a retainer fee, which is upfront money to help insure that the lawyer gets paid all or part of the fee. Retainer fees are divided into two types: 

  • regular or refundable: a retainer fee that must be put in the lawyer's trust account and can only be taken out and pocketed by the attorney, either all at once, or in parts when it is earned.
  • non-refundable: a retainer fee that will not be refunded. The advantage to the lawyer of a non-refundable retainer is that s/he may pocket it upon receipt.

Naturally, the client would prefer the retainer fee to be a regular retainer fee.

Signing A Contract

Is it Legal to Send a Non-Lawyer to Sign-up the Client?

If the client is in the hospital following an injury and calls the lawyer's office about possible representation, many personal injury attorneys send a non-lawyer to the hospital to sign up the client. According to the Nevada State Bar signing up a client is lawyer work that cannot be delegate to non-lawyers. A contract initiated between a client and a non-lawyer employee of the lawyer may not be valid. But why hire a lawyer who can't be bothered to meet you in person?

If you have just signed a contract with a law firm and never spoke to a lawyer when signing up, the contract can be cancelled if you want to do so. However, if the firm has done a lot of work on your case already, it may be a different story.