All You Need To Know About Different Types Of Attorney Fees
The American court system has different elements that handle all types of law cases. The two primary systems involve federal courts and state courts, and the two principal types of cases come under the jurisdiction of either criminal or civil law. Lawsuits against individuals or organizations are handled in the civil court system. This should itself answer anyone who has wondered what type of lawyer is needed for a lawsuit.
Lawsuits may relate to a number of issues ranging from defective products to medical malpractice. Civil cases are handled in the same manner as criminal offenses in that they involve attorneys representing both sides and a citizen jury that will decide the issue. As is the case with criminal law, the person who is the facing accusations is the defendant. The person or group filing the case is the plaintiff, which differs from criminal law.
Different types of civil litigation are handled by different types of lawyers in court cases. Lawyers that represent plaintiffs in civil cases usually specialize in certain areas. This is why it is important for clients to locate a civil litigation lawyer who can best meet their needs.
When it comes to hiring legal representation, whether it’s for a family court case, a matter of divorce, bankruptcy filing, litigation or arbitration, attorney fees and costs are one of the biggest concerns. With so many types of lawyers out there, it can be confusing trying to figure out how attorney fees work and how attorney-client fees are structured.
First things first, there are several common fees that pay only for an attorney’s time. In addition to fees, you might also end up paying extra costs to keep an attorney on retainer or for the cost of filing all needed court papers or for sending correspondence. Some of the most common types of fees are:
- Hourly rate fees
- Flat rate fees
- Contingency fees
Let’s take a closer look at what all of those entail:
- Hourly rates: With hourly rate fees, an attorney fee is typically set by an hourly rate for his or her work. A typical attorney fee in an hourly rate setup can range anywhere from $100 in smaller towns to more than $300 in bigger cities. Attorneys that specialize in a particular area of law will likely have a bigger hourly rate, but the trade off is these attorneys are experienced, have dealt with cases just like yours and can quickly complete legal work to help you avoid having to pay any extra attorney fees.
An attorney fee in an hourly rate setup tend to bill in 1/10th of an hour increments. What does this mean? It means you or the company you work for will be billed one-tenth of an hourly rate for every six minutes spent on your case. This is not the case for everyone and most attorneys just tend to bill their clients monthly.
- Flat-rate fees: These fees are when an attorney charges a flat fee for a specific legal task. In this way, an attorney fee is the same regardless of how many hours are spent working on a case or its outcome. Flat-rate fees in fact are becoming a more and more popular way of billing.
Increasingly, more attorneys are willing to offer flat-rate fees for tasks that are well-defined such as drawing up basic contracts, uncontested divorce cases and forming a business entity. For more complex things like lawsuits, flat rates are usually not applicable because attorneys end up doing a lot more work and they don’t want to get short-changed.
- Contingency fees: These kinds of attorney fees are based on success. That means if you win a court case, your attorney will typically take a percentage of the amount you win. If you lose your case, your attorney gets nothing. The percentage of an attorney fee depends on how big your settlement is. If a case is settled before trial, the fees is typically smaller because less time is spent on it. If the case goes to trial, the attorney fee is bigger.
Typically, contingency fees are only utilized when there is a dispute; think medical malpractice cases, debt collection cases and auto accident cases. If you win, an attorney will typically receive about 33% of your settlement and is actually less than what the cost would be if it were hourly.
You may be wondering after reading about all the types of fees just how attorney fees are calculated anyway. Typically, attorneys set their own fees, but need to keep them in a “reasonable” range. This range isn’t exactly black and white, but attorneys use several factors to set their fees:
- The attorney’s reputation
- The attorney’s education and experience level
- How complex a case is
- The typically fees for attorneys in your area
- The type of fee arrangement that’s used
- Possible time constraints for the attorney and/or the client
- The time required to represent a client
In 1962, 11.5% of federal civil cases went to trial. Today, experts say the percentage of civil cases that actually reach trial in the federal courts is estimated to be about 1%. If you or the company you work for finds yourself in the middle of a federal dispute, hiring an experience and reputable attorney is essential, regardless of what fee agreement is used.