Personal Injury · Haute Lawyer Network
How Do Contingency Fees Work?
Last reviewed: October 2026 · Jurisdiction: United States (examples: Florida, federal)
A contingency fee means your lawyer is paid a percentage of any recovery and collects no fee if you recover nothing. The agreement must be in writing and say how the percentage and case costs are calculated. Some rules cap the percentage: Florida's bar rules set a sliding schedule, and federal tort claims are capped at 20% or 25%.
| Key facts (United States; Florida and federal examples, as of October 2026) | Rule | Source |
|---|---|---|
| Written agreement | Must be in writing and signed by the client; it must state the percentage at each stage, which expenses come out of the recovery, and whether expenses are deducted before or after the fee is calculated | ABA Model Rule 1.5(c) (each state adopts its own version) |
| Closing statement | At the end, the lawyer must give a written statement showing the outcome, the remittance to the client and how it was calculated | ABA Model Rule 1.5(c) |
| Where contingency fees are banned | Criminal defense; divorce and support matters where the fee depends on the outcome | ABA Model Rule 1.5(d) |
| Florida personal injury caps (before an answer is filed) | 33⅓% of the first $1 million recovered, 30% of $1–2 million, 20% above $2 million | R. Regulating Fla. Bar 4-1.5(f)(4)(B) |
| Florida personal injury caps (after an answer, through trial) | 40% of the first $1 million, 30% of $1–2 million, 20% above $2 million (different tiers apply if liability is admitted or the case is appealed) | R. Regulating Fla. Bar 4-1.5(f)(4)(B) |
| Claims against the federal government (FTCA) | Lawyer's fee capped at 20% of an administrative settlement and 25% of a judgment or settlement after suit | 28 U.S.C. § 2678 |
How the fee is figured
Most agreements set a percentage and often raise it as the case advances: one rate if it settles before a lawsuit, a higher one once suit is filed or trial preparation starts, sometimes another on appeal. Many states leave the percentage to the lawyer and client, subject to the general rule that fees must be reasonable. Some states and some types of claims cap it, such as Florida's schedule above and federal tort claims.
Fees vs. costs
Costs are separate from the fee: filing fees, medical records, expert witnesses, depositions, exhibits. Many firms advance them and are repaid from the recovery. Two questions decide how much you take home:
- Are costs deducted before or after the percentage is applied?
- Do you owe costs if you lose?
The agreement must answer both in writing (Rule 1.5(c)).
Worked example (hypothetical numbers)
Say a case settles for $100,000, the fee is one-third, and the firm advanced $7,000 in costs.
| Costs deducted first | Fee on the gross | |
|---|---|---|
| Fee | ⅓ × $93,000 = $31,000 | ⅓ × $100,000 = $33,333 |
| Costs repaid | $7,000 | $7,000 |
| Client receives | $62,000 | $59,667 |
Same settlement, same percentage, about $2,333 apart, just from the agreement's wording.
Before you sign
- What's the percentage at each stage, and what triggers the next stage?
- Are costs taken out before or after the fee?
- Who pays costs if there's no recovery?
- Are medical liens and other liens paid from my share?
- Will I get a written closing statement?
- Can the fee be negotiated? Agreements are contracts, so the percentage, stages and cost terms can be discussed before signing.
Where contingency fees are and aren't used
Contingency fees are common in personal injury, wrongful death and medical malpractice, and appear in some employment and commercial recovery cases. They're banned in criminal defense and in divorce or support matters where the fee would depend on the result (Rule 1.5(d)). Those matters are usually billed hourly or by flat fee.
Talk to a personal injury attorney
- Find a Personal Injury Attorney · Florida
- Jarrett Blakeley — Fort Lauderdale, personal injury, Blakeley Car Accident & Personal Injury Lawyers
- Françoise Haasch — Palm Harbor, Florida, personal injury, Fran Haasch Law Group Accident & Injury Lawyers
Related reading: What is a contingency fee? · What does a personal injury lawyer charge? · Should I accept the first settlement offer? · What is a statute of limitations?
This article is general information, not legal advice, and doesn't create an attorney-client relationship. Fee rules vary by state and case type. Read your fee agreement carefully before you sign.
Sources
Frequently Asked Questions
What percentage do contingency fee lawyers take?
It depends on the agreement and the state. Many states leave it to the lawyer and client, subject to a reasonableness rule. Some cap it: in Florida personal injury cases, the cap is 33⅓% of the first $1 million before the defendant files an answer and 40% after. Federal tort claims are capped at 20% or 25%.
Do I pay anything upfront?
Usually no attorney's fee upfront. Ask whether the firm advances case costs, and whether you owe those costs if there's no recovery. The agreement has to say.
Are costs taken out before or after the lawyer's percentage?
Either, depending on the agreement, and it changes what you take home. The ABA Model Rules require the written agreement to say which (Rule 1.5(c)).
Are contingency fees negotiable?
Often. Fee agreements are contracts, so the percentage, the stages and how costs are handled can be discussed before you sign, within any cap your state sets.
Can a divorce or criminal lawyer work on contingency?
No. The ABA Model Rules, and most states' versions, prohibit contingency fees in criminal defense and in divorce, alimony or support matters where the fee depends on the outcome.
What happens if I fire my contingency fee lawyer?
The lawyer may still be entitled to a fee for work already done, often paid from any eventual recovery. The details depend on your agreement and state law, so read the termination clause before you sign.
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