Personal Injury Law

San Diego Needs Contingency Fee Lawyers

By Ross Jurewitz

Yesterday, the Bush administration instructed all levels of the federal government that they cannot, under any circumstances, hire attorneys on a contingency fee basis. Reportedly, this does not happen very often but it has not prevented the tort reform supporters like The US Chamber of Commerce and US Chamber for Legal Reform from applauding the move.

The Chamber argues that attorneys should not have a financial stake when representing states.

Make no mistake. While the Chamber may have an interest in the small number of cases where states and the federal government use contingency fee lawyers to sue businesses, it is far more concerned about the larger number of cases where everyday, ordinary people hire contingency fee lawyers. In the aggregate, these cases presumably add up to a greater amount of damages.

Traditionally, there are two methods to pay for an attorney:
1. On an hourly basis at rates of $200 per hour and up, plus advancing costs; or
2. On a contingency fee basis with the attorney being paid a percentage of any money recovered and the attorney advancing costs.

It's crucial to the function of the legal system that everyone with a meritorious claim have access to the legal system, regardless of cost. Imagine a world where the victims of rear-end car crashes and victims of benzene poisoning like those in Erin Brockovich can't hire a lawyer to fight the lawyers hired by insurance companies or big business because they can't afford hourly rates.

Contingency fees allow clients to hire an attorney when they otherwise could not. Clients do not need to come up with a retainer and pay the monthly invoices as they come due.

Contingency fees also allow clients to distribute the risk with their attorneys in more favorable terms. When a client pays an attorney by the hour, the attorney gets paid--regardless of result. If the client loses or does not do as well as hoped for, the attorney gets paid for his time anyway. On the other hand, if the client loses, the attorney gets paid nothing.

Last, it's weird that the Chamber (read: Republican big-business supporters) are against clients having the freedom to enter into contingency fee agreements. These are the same people who want the free market to guide economics and regulations. If a client determines that it is best to hire an attorney by pledging equity in their case, who is the Chamber to say that is wrong?

Nobody, that's who.

Full post as published by San Diego Injury Lawyer Blog on May 18, 2007 (boomark / email).