Before filing a lawsuit, it's important to understand what your attorney fees will likely be.
This article discusses the various ways in which attorneys bill their clients.
How to Avoid Attorney Fees
Before we discuss attorney's fees in detail, we should remind you that you don't have to have an attorney. However, if you choose not to have an attorney and decide to represent yourself in court, you certainly greatly reduce your chances of winning a court case.
If attorneys fees are a big challenge for you and you cannot find an attorney to take your case on a contingent basis (we'll explain what that means in a second), you may want to see if you can find a pro bono lawyer who will work for you for free. There are many legal service nonprofit agencies that help people with legal matters if they do not have enough money to pay a lawyer.
Three Common Attorney Fee Methods
Assuming that you are going to engage a traditional attorney, you will typically pay them in one of three ways: billable hours, flat fees, or contingent fees.
It's a common practice to document the attorney fee arrangements in writing up front, before a lawyer starts working for you. If you don't have the fee agreement in writing, it should raise a red flag.
With the first method, billable hours, it's a bit like a taxi ride. You'll be charged based on how much work the attorney does on your behalf. With a taxi ride, the further you go, the bigger the fare. It's the same thing with attorney fees if you are paying by the hour. The more hours the attorney works, the bigger your legal bill will be. However, you may be able to cap the fees at a certain amount.
With a flat fee, you agree to pay a certain amount for attorney fees, regardless of how many hours the attorney puts into the case.
Note that with attorney hourly billing and attorney flat fee billing, you pay the attorney regardless of whether you win your case or not. That's not the case with the third attorney fee method, contingent fees.
In a contingent fee arrangement for legal services, your attorney doesn't require you to pay any upfront legal fees or any ongoing legal fees. Instead, they agree to take a percentage of the judgment or settlement. That's great for you because if you lose the case, you are not on the hook for a ton of legal fees. Unfortunately, not all lawyers are willing to work on contingency and not all case types are appropriate for a contingency arrangement.
Non-Contingency Cases May Require a Retainer
Many lawyers may require an upfront fee called a retainer. If your lawyer asks you for money up front, that is not unusual. The retainer is in effect a prepayment for a certain amount of attorney hours, and it allows the lawyer to work for you without having to worry that you won't pay them. After the lawyer burns through the hours funded by the initial retainer, you may be required to make additional attorney payments.
Reimbursement for Legal Fees
In some cases, if you win your case, you may be able to recoup legal fees from the opposing party. The laws on this vary considerably. Your lawyer will know whether this is a possibility for your case.
The flip side on this is that you may be responsible for your opponent's attorney fees if you lose. Be sure to ask your attorney whether you may be liable for their fees and what those fees might end up being.
Shop Around for Attorney Fees
While there are rules of thumb on how much attorneys charge for various cases, it still pays to shop around. Attorneys will sometimes lower fees if you let them know that a competing law firm is willing to do the work for less.
However, be careful. Getting the lowest attorney fee is not your main goal. Your main task is to win your case. In some instances, the attorney with higher fees will be your best bet.