COMMERCIAL LITIGATION AND CONTINGENCY ATTORNEY CASES
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The cost of commercial litigation is a frequent
concern. See Wiley, Alternatives to the High Cost of Litigation
(2012). While a few businesses may not mind paying legal fees which equal
or exceed the amount recovered to vindicate a principle, most seek a net
recovery. The typical legal fee agreement provides no guarantee of that
and typically makes the client responsible for unexpected costs, delays,
contentious parties and their counsel, new factual or legal issues, lengthy
discovery, and other factors.
Since the typical hourly fee agreement
places these risks upon the client, a lawyer's willingness to accept or defend a
claim on an hourly basis tells relatively little about his assessment of its
ultimate merits. In comparison, contingency representation requires the
lawyer to accept risks and undertake a careful assessment on the onset.
Before taking any new case on a
contingency fee basis, the attorney must complete extensive due diligence
concerning the likelihood of success (however the client defines it). A business
lawsuit can last three years or more. During that time, the attorney will face
many risky patches. These include legal risks, such as dispositive motions, loss
at trial, or loss on appeal. They also include client-related risks, such as the
revelation during discovery of critical and outcome-changing information, or a
client's change in goals. In light of these risks, it is important that the
attorney be realistic about the potential outcome and structure the fee
accordingly. As Justice Corrigan wrote in a recent concurring opinion,
“Contingency fee percentages express an attorney's expectations of the case and
the risks involved. Contingency Fees for Business Disputes, 35
Michigan Bar Journal November, 2011.
Here are some guides to improving your chances
of having a lawyer take your commercial case on a contingency basis.
1. Simple explanation of case
A simple case is easier to litigate and explain to a jury or judge. Provide a clear and concise explanation of your claim, with further detail only if requested. Consider giving a short summary and longer documented explanation.
2. Evidence of the claim
Provide the lawyer with evidence to support your claim. A claim based upon the plaintiff's own testimony is more difficult to provide given his incentive to portray events in a manner that favors his claim. For the lawyer, hourly representation not only insures payment regardless of the result, but gives the client the incentive to candidly describe his claim. Be prepared to explain how your claim is independently verified.
3. Client Candor
Plaintiff presents a claim which on further investigation turns out to
be ill-founded. In any hourly arrangement, the plaintiff bears the cost
and burden, as the lawyer is paid regardless of result. In a contingent
arrangement, the lawyer bears the cost of wasted time, his stock and trade as
Lincoln put it. Thus, a critical question is the reliabilty of the
information the client provides with his crediblity a key. Exaggeration
and omitted facts may be ignored by some lawyers in an hourly arrangement, but
cause for rejection in proposed contingency arrangements.
4. Explain facts but not law.
Knowledge of the law is the attorney's job. The client's task is to explain and provide the factual support for the claim. You generally do not need to tell the lawyer about other favorable cases or large verdicts. Typically newspaper reports features the plaintiff's wins or large settlements, and may be unrepresentative. A lawyer will want a client who will assist with the claim but does not have unrealistic expectations.
5. Show damages
Explain how you have suffered financial loss, such as lost wages.
6. Don't expect a cheerleader and expect tough questions about your case and potential defenses.
The hourly lawyer is paid regardless of result and has the luxury of accepting his client's version of events. Since the contingent lawyer is paid only upon success, he needs to conduct a searching inquiry, and even question his own client's version of events to assure that it will survive scrutiny.
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HOW DO I CONTACT YOU
Law Offices of Howard A. Gutman,
230 Route 206, Flanders, New Jersey 07836
(973) 598-1980, E-mail Howian@aol.com
Fax (973) 531-4110
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New York Office
315 Madison Avenue, Suite 901
New York, New York 10165 (212) 886-4838
FREE INITIAL
CONSULTATION
We offer a free initial telephone consultation to discuss your claim. Please feel free to call or e-mail our office.
Links
www.allbusiness.com/legal/law-firms-attorneys/2243 (description of contingency agrement)
Articles on legal fees
and contingency representation
Age
Discrimination and contingency lawyer
Contingency representation articles.
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