Expenses in a Malpractice case

[JoeLaw]

Jurisdiction

Illinois

I just discussed my malpractice case with an attorney. He said that he would be interested in taking the case and sent over a contract. The contaract seems fine but I am very concerned with the Expenses section. The verbiage used makes it seem like I would be responsible for all the expenses, if we lose the case. What do you think? Am I over reacting ?

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Client authorizes the Firm to employ such persons or entities as may be needed by
the Firm in handling these proceedings, including, but not limited to, investigators and expert
witnesses. The Firm promises to consult with Client before retaining such persons or entities.
Client agrees to pay for the fees of such persons or to reimburse the Firm for such advances
made within ten (10) days of receiving an accounting detailing such advances.

Initials

Page 3 of 6

6. Client authorizes the Firm to incur all necessary expenses in connection with
these proceedings, including, but not limited to, Court costs and expenses for filing and serving
papers, messenger expenses, long distance phone calls, copying and obtaining copies of
materials, certifications of documents, transcripts, travel expenses, and other out-of-pocket
expenses. Client agrees to pay for such expenses and agrees to promptly reimburse the Firm
within ten (10) days of receipt of an accounting of such advances.


7. Client hereby authorizes the Firm to affiliate with other attorneys for purposes of
pursuing this cause of action if, in the sole opinion of the Firm, it is necessary. The affiliation or
association of additional attorneys will not be considered a cost for purposes of reimbursement
but shall be paid out of the attorney contingency fee.

8. Client acknowledges that he knows that he remains responsible for all costs
incurred by the firm whether or not recovery is made.

9. The Firm at its sole discretion may "advance" costs on behalf of Client.

10. Client acknowledges that any costs advanced by the Firm will be subtracted from
Client's portion of the settlement and retained by the Firm. Client will be supplied a final
accounting for all costs expended at the time of closure of this cause.

 

[Tax Counsel]

I just discussed my malpractice case with an attorney. He said that he would be interested in taking the case and sent over a contract. The contaract seems fine but I am very concerned with the Expenses section. The verbiage used makes it seem like I would be responsible for all the expenses, if we lose the case. What do you think? Am I over reacting ?

In the states in which I've practiced what you quoted is pretty much standard. The most common contingent fee arrangement in my state is that the lawyer's fee is one-third of whatever is recovered for the client but the client is responsible for all out of pocket expenses, including filing fees, court costs, deposition costs, expert witnesses, photocopies, postage, etc. Those costs are paid by the client regardless of the outcome of the case.

Some firms here do offer an alternative where the client pays none of the expenses directly but the lawyer takes half of the amount recovered to pay for his/her fee and to cover those expenses that were incurred over the course of the litigation.

 

[JoeLaw]

D

In the states in which I've practiced what you quoted is pretty much standard. The most common contingent fee arrangement in my state is that the lawyer's fee is one-third of whatever is recovered for the client but the client is responsible for all out of pocket expenses, including filing fees, court costs, deposition costs, expert witnesses, photocopies, postage, etc. Those costs are paid by the client regardless of the outcome of the case.

Some firms here do offer an alternative where the client pays none of the expenses directly but the lawyer takes half of the amount recovered to pay for his/her fee and to cover those expenses that were incurred over the course of the litigation.

Thanks for the quick reply. The Attorney is keeping 33% of the pay out and his lawyer fees. Since this is a small case. Probably 20-30K payout at best, I am very hesitant to take the risk of being stuck with the expenses if we lose. Any idea what those expenses might be?

 

[Tax Counsel]

Thanks for the quick reply. The Attorney is keeping 33% of the pay out and his lawyer fees. Since this is a small case. Probably 20-30K payout at best, I am very hesitant to take the risk of being stuck with the expenses if we lose. Any idea what those expenses might be?

A lot depends on the details of the case you have. Your lawyer would be in the best position to tell you what to expect. Very generally though, in a medical malpractice case the costs can run into tens of thousands of dollars. The biggest costs are for expert witness fees and depositions and other discovery. But it matters a lot how obvious the malpractice is. The more obvious it is, the less you'll need in the way of expert witnesses and discovery. Ask your lawyer what total costs you might have in your case and ensure the lawyer contacts you before spending any significant amounts on the case.

 

[zddoodah]

The verbiage used makes it seem like I would be responsible for all the expenses, if we lose the case.

It say that the Client is responsible for paying the stated expenses only if the case is "lost;" the Client is liable whether the case is "won" or "lost."

Any idea what those expenses might be?

We know nothing about your case, but the biggest expense in a legal malpractice case will be the medical expert witness(es), who are likely to charge $300+ per hour and probably have $5-10k minimums.

This is something you need to discuss in detail with your lawyer before signing the retainer agreement.

 

[cbg]

I'm curious; who you do think should be responsible for expenses if the case is lost, and why?

 

[JoeLaw]

I'm curious; who you do think should be responsible for expenses if the case is lost, and why?

I think a malpractice attorney should review a case before taking it on. Since they are taking 33% or the payout and the legal fees/expenses in a winning case, the attorney should cover some expenses up front.
I agree that expenses in these type of cases can get out of control and there needs to be a point where the attorney calls it quit and allow the client to pick up the expenses if he desires to continune

 

[cbg]

The attorneys DO cover the expenses up front. That's the whole point.

Are you suggesting that if the case is lost, the attorney should eat the cost of the expenses?

 

[JoeLaw]

The attorneys DO cover the expenses up front. That's the whole point.

Are you suggesting that if the case is lost, the attorney should eat the cost of the expenses?

Yes. At least within reason

 

[Tax Counsel]

Yes. At least within reason

Then find a lawyer willing to do that — there are lawyers out there who will cover costs. But you can likely expect that the contingent fee amount will be more. In my area, lawyers who will pay the out of pocket costs typically take a 50% contingent fee. If you go for the 33% contingent fee, you are obligated to pay most of the out of pocket expenses. Often the lawyer will wait to charge you until the case is completed and simply deduct those expenses from the recovery, along with the lawyers 33% fee, so the client might never have to write a check for the expenses unless the case turns out not to recover enough to pay for them.

So you ought to consult several lawyers in your area and see what kind of fee deal you can strike. Bear in mind that like with anything else, it is not always best to go with the cheapest bid. You want to take a number of factors into account when picking a lawyer, just as you would hiring anyone for an important service.

 

[cbg]

IMO, Joe, there is no 'within reason' about it - to expect anyone but the plaintiff to bear the expenses of bringing the case is NOT reasonable.

 

[zddoodah]

It say that the Client is responsible for paying the stated expenses only if the case is "lost;" the Client is liable whether the case is "won" or "lost."

Yeesh...typo in my prior response. Should have said, "It does not say that the Client is responsible for paying the stated expenses only if the case is "lost. . . ."

 

[Zigner]

Malpractice attorneys are taking a considerable amount from their clients.They are taking 33% or the payout and the legal fees/expenses in a winning case, so they must be responsible to cover some expenses up front.

Under what law would an attorney be required to cover some expenses up front?

 

[justblue]

Under what law would an attorney be required to cover some expenses up front?

To clarify for @Hotze Runkle : Under what law in IL would the attorney be required to cover some expenses up front?

 

[zddoodah]

Malpractice attorneys are taking a considerable amount from their clients.They are taking 33% or the payout and the legal fees/expenses in a winning case, so they must be responsible to cover some expenses up front.

"Must be"? Says who? And what exactly does that mean?

By necessity, lawyers almost always "cover some expenses up front" (and throughout the course of a case). Typically, then then bill their clients for reimbursement of those expenses. Ultimately, however, this is entirely a matter of contract -- i.e., who is ultimately responsible for paying expenses depends on what the contract between the lawyer and client says.