Contingency Fees for Personal Injury

[Mr. Knowitall]

I would like to limit my question to just the above portion of the lawyer's contract. For the sake of argument, let's say that there are $1,000 in out-of-pocket expenses (copying, medical reports, court costs, etc.), and the recovery (the gross amount collected) is $10,000. I interpret the contract above to say that the lawyer gets 36% of $10,000 (= $3,600) and I receive $6,400 (= $6,400). I would next have to deduct $1,000 from my share to reimburse the lawyer for the $1,000 advanced to me for the out-of-pocket expenses. This leaves me with $5,400.

You have told us that you agreed to pay your lawyer in that manner.

I would like to negotiate with the lawyer to amend the contract, so the 36/64 split is based on the net amount recovered. Using the situation above, the out-of-pocket $1,000 would first be deducted from the (gross) $10,000 recovery, leaving $9,000. The lawyer would apply his 36% share against this (= $3,240) and I would receive 64% (=5,760).

You are free to ask if the lawyer will renegotiate the agreement. He is free to say "no".

Can you tell me which of these two situations is considered "common practice"?

If you want us to tell you how often attorney fees in your state premise their contingency fees on recovery against gross as opposed to net, if the law permits the former I expect that most will do the former.

You should review the statute linked above to see if it applies to your case and, if so, to what effect.

Is my wish to split the net amount 36/64 a reasonable thing to ask?

We know nothing about the case or its complexity but it doesn't much matter because our opinions count for nothing. With a few exceptions for higher risk or high expense cases, I personally think that attorney fees should normally be calculated off of net recovery, but my opinion and $2 will get you a cup of coffee.