The cost of hiring a lawyer can seem out of reach for many people. Fortunately, anyone can get the professional legal assistance they need if they’ve been injured in an accident. This is because personal injury lawyers typically charge on a contingency basis.

This means that the client pays nothing out of pocket. The lawyer only gets paid at the end of the process – and only if they reach a settlement for you. If they don’t reach a settlement, they don’t receive any payment for their services.

How much is the contingency fee? This ranges somewhat. Some factors are the size of the potential settlement, the type of claim, and market conditions. A typical rate is in the range of 33 to 39 per cent.

Let’s say your injury lawyer gets you a $10,000 settlement and the contingency fee is 35 per cent. Does that mean you get $6,500 and your lawyer gets $3,500? Not quite. Your lawyer will subtract disbursements from the settlement amount.

Disbursements are the various fees incurred during the process of resolving a claim. These fees include photocopying and postage, costs for medical charts obtained, court filing fees (if any), and so on. All of these fees are itemized on the lawyer’s final bill to the client.

Once a settlement is reached with the defendant (or typically with the defendant’s insurance company), the settlement funds are sent to your injury lawyer. These funds are held in trust by your lawyer. He or she then calculates the final bill and releases the balance to you.

For example, here’s what a final bill (with a contingency fee of 35 per cent) might include:
Settlement amount: $10,000
Fees pursuant to contingency agreement: $3,500
Faxes, photocopying and postage: $60.00
Chart copy from ABC Medical Clinic: $100.00
Chart copy from Alberta Health Services: $25.00
Total disbursements: $185.00
Total GST: $184.25
Total fees, disbursements & GST: $3,869.25

In the above example, $3,869.25 would be subtracted from the settlement amount of $10,000. You, as the client, would receive a cheque in the amount of $6,130.75.

For more information about lawyer fees, visit the Law Society of Alberta’s website.