Pennsylvania Contingency Fee Agreement with an Attorney or Law Firm

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US-00442BG
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Description

There are various types of attorney fee arrangements such as time based, fixed, or contingent. Time based means a fee that is determined by the amount of time involved, such as so much per hour, day or week. Fixed means a fee that is based on an agreed amount, regardless of the time or effort involved or the result obtained. Contingent means a certain agreed percentage or amount that is payable only upon attaining a recovery, regardless of the time or effort involved.


With a contingent fee arrangement, the lawyer receives no fee unless money is recovered for the client. Upon recovery, the lawyer is paid an agreed-upon percentage, usually ranging from an amount equal to 25 to 50 percent of the amount recovered. A written fee agreement should specify the costs and expenses to be deducted and whether such costs and expenses are to be deducted before or after the contingent fee is calculated. Contingent fee agreements are generally not permitted for criminal cases or domestic relations matters.


Even if there is no recovery, however, the client is still responsible for court costs (filing fees, subpoena fees, etc.) and related expenses, such as telephone charges, investigators' fees, medical reports, and other costs.


This form is a fairly typical contingent fee agreement

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FAQ

Generally, in Pennsylvania attorneys' fees are only recoverable in a successful lawsuit if provided for by contract or statute. This is known as the ?American Rule.? Unless stated otherwise in a contract, each party to a lawsuit pays its own attorneys' fees.

The ?American Rule? requires each party to bear its own attorney's fees in litigation absent a statutory or contractual exception. [i] Fee-shifting provisions are the exceptions to that general rule.

The fundamental principle of a contingency fee arrangement is that when rendering an invoice at the end of the case the solicitor cannot charge his client more than he would have done had he taken the case on the normal basis. If the case is lost no fee is payable to the solicitor.

The American rule for attorney fees requires each party to pay its attor- ney, win or lose; the English rule (applicable in most of the world) requires the losing party to pay the winner's reasonable attorney fees. We study fee clauses in 2,347 contracts in large corporations' public securities filings.

There are four exceptions to the American Rule where a prevailing party may be awarded attorney's fees: ?(1) the parties to a contract have an agreement to that effect, (2) there is a statute that allows the imposition of such fees, (3) the wrongful conduct of a defendant forces a plaintiff into litigation with a third ...

That said, the most common lawyer contingency fee average ends up being 33%, or ? of the total earnings of a case, but can go up to 40% (in some jurisdictions) as the complexity and risk involved in taking the case increases.

Certain statutes allow for the recovery of attorneys' fees. Such statutes include the PA Unfair Trade Practices and Consumer Protection Law, the PA Trademark Act, and the PA Uniform Trade Secrets Act.

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Pennsylvania Contingency Fee Agreement with an Attorney or Law Firm