What Is a Contingency Fee? A Clear Guide for Texas Clients

Understanding how legal fees work is important before hiring a lawyer. For many people, a contingency fee agreement can make legal help more accessible—especially in personal injury cases or civil claims. This article explains what a contingency fee is, how it works, and when it makes sense to work with lawyers on a contingency fee basis.

Contingency Fee Definition

A contingency fee is a payment method where a lawyer receives a percentage of the money recovered for the client. The key feature is this: the lawyer is only paid if the case is successful.

If no money is recovered, the attorney does not charge a fee for their time. This payment structure allows clients to access legal services they might not otherwise afford.

In legal terms, this is called a “contingent fee arrangement.” Under Rule 1.5 of the Texas Disciplinary Rules of Professional Conduct, these agreements must be reasonable and written.

How a Contingency Fee Agreement Works

With this type of agreement, a client does not pay upfront legal fees. Instead, the law firm collects a portion of the final settlement or court award.

Example:

If you win a $100,000 settlement and your attorney’s fee is 33%, the lawyer would receive $33,000, and you would keep the remaining $67,000—minus other expenses like court filing fees or expert witnesses.

The percentage charged varies depending on the type of case and when it resolves. If a case settles quickly, the rate may be lower than if the case goes to trial.

When a Contingent Fee Arrangement Is Used

Contingent fees are most common in civil cases where clients seek financial compensation. Here are some examples:

• Personal injury cases (car accidents, slip and fall injuries)
• Medical malpractice
• Product liability
• Wrongful death
• Workplace injury
• Some commercial disputes

They are rarely used in criminal cases or family law matters, as these usually do not involve monetary damages.

Advantages of Hiring Fee Lawyers on a Contingency Fee Basis

Hiring a lawyer on this basis offers several benefits:

1. No Upfront Costs

Clients pay nothing out of pocket to begin the case. This helps people pursue claims without needing large sums of money upfront.

2. Aligned Interests

Your lawyer has a financial incentive to win or settle your case for the highest amount possible. If you don’t win, they don’t get paid.

3. Access to Legal Services

Contingent fee agreements give people access to skilled lawyers, even if they cannot afford traditional hourly rates.

4. Risk Sharing

The law firm takes on the financial risk. If the case fails, they absorb the loss.

Drawbacks to Consider

While contingency fees offer many advantages, there are some things to keep in mind:

1. Higher Final Cost

In some cases, the fee may be more than what you would have paid with an hourly fee arrangement—especially if the case settles quickly.

2. Limited Case Types

Contingency arrangements are not available for all legal matters. Criminal defense, divorce, and immigration cases generally do not qualify.

3. Expenses May Still Apply

You might still owe costs like court filing fees or expert witness charges. Discuss with your attorney whether these are covered if the case is lost.

What to Expect in a Contingency Fee Agreement

A valid agreement should clearly define:

• The lawyer’s percentage (often 33% to 40%, depending on when the case settles)
• Whether the fee changes if the case goes to trial
• Responsibility for litigation expenses
• How attorney fees are calculated
• The scope of legal services included

The Model Rules of Professional Conduct require that the agreement be in writing, so you fully understand the terms before signing.

Always ask questions before agreeing. A good law firm will explain every part of the contract so you know what to expect.

Is a Contingency Fee Lawyer Right for You?

This arrangement is a good option if:

• You have a strong claim for money damages
• You cannot afford to pay hourly attorney fees
• The law firm believes in the strength of your case

It may not be right for every situation. Some legal services are better handled with a flat fee or hourly rate. In cases with low potential recovery, lawyers may decline to take it on a contingency fee basis.

How Universal Law Group Can Help

At Universal Law Group, we help clients across Texas access justice through smart legal strategies and flexible fee options. Our attorneys work on a contingency fee basis in a wide range of personal injury cases and civil claims.

We believe everyone deserves quality legal representation, regardless of their financial situation. If you’re unsure whether your case qualifies for a contingent fee arrangement, we offer free consultations to explain your options.

Whether you’re recovering from an injury or resolving a legal dispute, we are committed to clear advice, honest expectations, and efficient legal services. We’ll walk you through the contingency fee meaning and make sure you understand the agreement before moving forward.

Closing Remarks

A contingency fee can be a smart choice when you need legal help and don’t have the funds to pay upfront. This is a practical way to pursue a valid claim with less financial risk. Always read the contingency fee agreement carefully and choose a law firm that explains everything clearly.

If you’re considering lawyers on contingency fee terms, reach out to Universal Law Group for guidance. We’re here to help you move forward—with clarity, confidence, and commitment.