Legal & IP
Definition
A contingency fee is a legal fee arrangement in which an attorney is paid only if the case is won or settled — typically a percentage (25–40%) of the recovered amount. If the case is lost, the client generally owes no attorney fees.
In a contingency fee arrangement, the attorney takes on financial risk alongside the client. The standard contingency fee is 33% (one-third) of the recovery, though rates range from 25–40% and may increase if the case goes to trial or appeal. Contingency fees are common in personal injury, medical malpractice, and employment discrimination cases — situations where the client has suffered a harm but may not have the funds to pay hourly rates upfront. Importantly, contingency fees cover attorney fees only — clients may still be responsible for court costs, filing fees, and expert witness expenses even if the case is lost. Contingency arrangements must be in writing and signed by the client. Not all case types allow contingency billing: criminal defense and most family law cases are typically excluded.
Contingency fees make legal representation accessible to clients who couldn't otherwise afford hourly rates for high-stakes cases. When evaluating an attorney under a contingency arrangement, ask what percentage they charge, at what stage the rate changes, and who pays case costs if you lose. A legal advisor can help you understand whether a contingency arrangement or hourly billing is better for your situation.