How Lawyers Get Paid In Personal Injury Cases

Here is the difference between how plaintiff’s lawyers and defense lawyers get paid in personal injury cases:

Plaintiff lawyers represent the injured parties who have either filed a claim or lawsuit against the defendant who injured them.

I’m a plaintiff’s lawyer. I represent people whom others have hurt through negligent acts. I don’t do defense work even though I get asked to do so fairly frequently.

Plaintiff attorneys usually take personal injury cases on a contingency fee basis. That means we get a percentage of whatever you recover plus our costs for handling the case. Costs can be postage, ordering police reports and medical records, holding depositions, and paying expert witnesses, among other things.

Personal injury cases are calculated risks for plaintiff’s lawyers. We can invest hundreds of thousands of dollars of time and money in a contingency fee case, and there’s never any guarantee we will win. If we don’t get a settlement or win a case, then we don’t get paid.

It’s far different for defense lawyers.

Defense lawyers in personal injury cases represent people who have injured other people in negligence cases like car accidents, slip and falls, and other injury cases.

Defense lawyers—who are almost always paid by insurance companies—get paid by the hour. They often have a vested interests in maximizing their “billable hours.” The more time a defense lawyer can ethically bill, then the more money he and his law firm can charge.

What are billable hours?

Well, that’s how much time a defense lawyer puts into a case in six minute increments (unless the insurance company is paying the lawyer a flat fee to defend a case). There can be other formulas, but six minute increments is pretty standard.

If the defense attorney is what we call “house counsel,” then he gets paid whatever his insurance company employer pays him. Most house counsel are salaried employees. Most defense attorneys are not house counsel, though, and use billable hours in six minute increments to determine what they get paid.

That means if the typical defense attorney makes a one minute phone call that he bills his client for six minutes of time.

So if a defense attorney makes six one minute phone calls within six minutes then he can bill the insurance company for 36 minutes of his time (at several hundred dollars per hour). In other words, a defense lawyer can theoretically bill for more hours than there is in a day.

That’s perfectly ethical. It’s how they work. It might not seem logical, but it’s ethical.

Yet win, lose, or draw, a defense lawyer gets paid. The insurance company pays him no matter what happens in a case.

No matter what, a defense lawyer gets paid, unless he takes a case pro bono.

I have encountered only one case in which a defense lawyer had taken on a personal injury case pro bono (for free), and in that case, the defendant was uninsured.

That can happen. It just doesn’t usually happen. Everybody has bills to pay.

So how do I get paid as a plaintiff’s lawyer?

Well, let me tell you about a conversation I had with a Miami defense attorney after court (I handle cases throughout Florida) last week who tried to convince me to drop a negligence case:

Miami Defense Attorney: I don’t understand why you’re here. I get paid by the hour no matter what happens. I don’t think you can win [this case].

Me: I’m here because I get paid for results, and I make a damned good living doing it. I like this case. We’re going to trial.

Plaintiff attorneys in personal injury who work on a contingency basis get paid for . . . Wait for it . . . Results.

Not by the hour.

No results? Then we don’t get paid in contingency fee cases. That’s it. End of story.

I get paid for results in personal injury cases. Nothing else. That makes me highly motivated to get my clients the best possible results that I can.

 

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