Information or instructions: Contingency fee agreement for personal injury cases PREVIEW

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1 Information or instructions: Contingency fee agreement for personal injury cases 1. The following form is a written contingency fee agreement that may be used to employ the attorney to handle the personal injury case. 2. The agreement assigns an interest in the case to the attorney. It provides for structured or full settlements. See Section , SB 1388 for permissive provisions for a structured settlement. 3. The State Bar of Texas requires written fee agreements where the attorney receives a contingent interest. 4. PLEASE If the client has a worker s compensation DO NOT claim, make sure COPY that the fee agreement addresses this claim. The agreement should clearly state whether or not the worker s compensation claim is or is not being handled by the attorney. Form: Contingency fee agreement for personal injury cases ATTORNEY CONSULTATION AND FEE CONTRACT FOR CONTINGENCY CASES THIS AGREEMENT is made on, in [City, county and state], between [Client s name], hereinafter referred to as the "Client", and [Attorney s name] hereinafter referred to as the "Attorney": In consideration of the mutual promises herein contained, the parties hereto agree as follows: 1. PURPOSE OF REPRESENTATION 1.1 The Client hereby retains and employs the Attorney to sue for and recover all damages and compensation to which the Client may be entitled as well as to compromise and settle all claims arising out of the [state the nature of the claim i.e. personal injuries due to an auto injury] [date of event] [potential defendants]. 2. ATTORNEY'S FEE 2.1 In consideration of services rendered and to be rendered by the Attorney, the Client hereby agrees to pay to him or her [thirty-three percent (33 %) or %] of all money and payment collected prior to the filing of a lawsuit and [forty percent (40%) or %] percent

2 if collected after said filing of a lawsuit and an additional [five percent (5%) or %] if an appeal is required to a higher court) provided, however, that, if said claim and cause of action be such that the fee allowed to an Attorney is set by law, and the law precludes any other fee arrangement other than the amount set by law, then the amount payable hereunder to said Attorney shall be limited to the maximum so allowed by law. [Optional paragraph is the client is paying a non refundable retainer in addition to the contingency fee.] 2.2 Client agrees to deposit a non-refundable retainer of $ with the Attorney to pay for the Attorney's initial research, review and preparation of Client's case. 2.3 At the time of each billing by the Attorney for expenses of litigation, the amount of legal services and expenses billed by the Attorney shall be disbursed from the trust account to the operating account of the Attorney. a. Each billing will reflect the legal services rendered and the deposit necessary to cover the estimated legal services and expenses for the next billing period. b. The Client agrees to make such additional deposits for expenses as are required by Attorney within ten (10) days of each billing. c. Unpaid fees and expenses, if not paid within thirty (30) days of billing date, shall bear interest at the rate of [ %] per annum until paid. STRUCTURED FEE PROVISION: 2.4 The attorney is authorized to engage in settlement negotiations for and on behalf of the client as the attorney deems appropriate. The attorney may enter into cash and/or structured settlement negotiations.

3 a. In the event, the attorney enters into cash or structured settlement negotiations, [he or she] is authorized to negotiate on client's behalf a settlement based upon the present value benefit of such settlement to the client. b. The present value benefit shall be determined by applying the appropriate discount rates that consider the after-tax benefits of the negotiated structured settlement to the client. c. In the event that the case is settled by way of structured settlement, the client hereby approves and authorizes the attorney's fees based upon the present value benefit of the settlement to the client. d. The client further authorizes the attorney to take his fee either in cash or in structured payments as the attorney deems appropriate. e. The client further hereby authorizes the attorney to retain structured settlement specialists to assist in evaluating the efficiency and benefits of such a settlement. f. The attorney is not required to retain such specialists but is authorized to employ the same. The fees for such specialists and their services will be deducted from the funds received, if any, in the settlement as an expense of litigation. 3. ASSIGNMENT OF INTEREST 3.1 In consideration of Attorney's services, the Client hereby sells, conveys, and assigns to the Attorney an interest, to the extent herein indicated above to client's claim and cause of action, and in any action, compromise, settlement, judgment, payment of services, profits or recovery thereon. 3.2 All sums that may come due and payable under this contingency fee agreement, are due at the Attorney's office in [County Texas]. 4. APPROVAL NECESSARY FOR SETTLEMENT

4 4.1 The attorney is hereby authorized to enter into any and all settlement negotiations on behalf of those whom attorney represents as the attorney deems appropriate. This includes, but is not limited to, the attorney's prerogative to pursue cash or structured payment settlement negotiations. [insert the structured fee paragraph if applicable- see the next form for the provision] 4.2 Client hereby grants unto attorney a power of attorney to handle negotiations and settlement discussions regarding the obtaining of possession of any and all moneys or other things of value subject of the matter due to the client under this claim as fully as the client could do so in person. a. This expressly includes the right to sign client's name on and to any insurance company drafts, money orders, cashier's checks, checks or other negotiable instruments made payable to the attorney and the client, the attorney, or to the client without the joinder of the attorney, submitted to the attorney on behalf of the client in full or partial settlement of this case. b. This limited power of attorney further authorizes the attorney to place these moneys, referred to above, in the attorney's trust account and from that trust account, make distributions and payments to the attorney for the agreed to fee stated above, reimbursement to attorney for any and all expenses incurred by the attorney in handling this case, payments to client of client's interest in the moneys recovered as stated above, and payments to parties other than client and attorney for their services performed, fees charged or bills rendered in connection with representing client, including but not limited to medical bills, court reporter fees, deposition fees, investigative services, costs of exhibits or other special expenses incurred by attorney on behalf of Client.

5 4.3 No settlement of any nature shall be made for any of the aforesaid claims or profits of the client without the complete approval of the Client, nor shall the Client obtain any settlement on the aforesaid claims without the complete approval of the Attorney. 4.4 Attorney is hereby granted a limited power of attorney so that he may have full authority to prepare, sign and file all legal instruments, pleadings, drafts, authorizations and papers as shall be reasonably necessary to conclude this representation including settlement and/or reduce to possession any and all moneys or other things of value due to the Client under this claim as fully as the Client could do so in person. 5. REPRESENTATIONS 5.1 It is understood and agreed that the Attorney cannot warrant or guarantee the outcome of the case and the Attorney has not represented to the Client that the Client will recover all or any of the funds so desired. The Client has also been informed that obtaining a judgment does not guarantee that the opposing party will be able to satisfy the judgment. 6. DEDUCTION OF EXPENSES 6.1 All reasonable expenses incurred by the Attorney in the handling of this project shall be deducted from the gross settlement proceeds at the time the case is settled or resolved. 6.2 The expenses contemplated above, include but are not limited to any and all out of pocket expenses incurred in connection with his or her case, including but not limited to the following expenses: filing fees, court costs, certified copies of documents, pleadings, orders etc., transcripts, depositions, duplication costs, postage, office supplies, photographs, trial exhibits, long distance phone & fax calls, appraisal fees, consultant s, expert witnesses and other fees associated with preparation and trial testimony, investigation fees, delivery charges, overnight mail/parcel services, parking, toll road & mileage expenses, out of town expenses including

6 travel expense, air fare, hotels, meals, and any other expense incurred in connection with the matter. 6.3 The client hereby empowers and instructs the attorney to deduct from the client s settlement proceeds the cost of any unpaid health care related or hospital bills including but not limited to charges which may or may not have a medical or hospital lien, letter of protection or other guarantee associated with the expense. [Optional paragraph is the client is paying a non refundable cost deposit in addition to the contingency fee. Client hereby deposits with Attorney an expense deposit in the amount of $[Amount] which shall be deposited in a trust account of the Attorney to be drawn against as expenses accrue.] 7. COOPERATION OF CLIENT 7.1 The Client shall keep the Attorney advised of his whereabouts at all times, and provide the Attorney with any changes of address, phone number or business affiliation during the time period which Attorney's services are required, and shall comply with all reasonable requests of the Attorney in connection with the preparation and presentation of the aforesaid representation. 7.2 The Attorney may, at his option, withdraw from the case and cease to represent the Client for any reason, including without limitation Client's failure to timely pay fees and expenses or deposits for same in accordance with this Agreement, subject to the professional responsibility requirements to which Attorneys are subject 7.3 It is further understood and agreed between the parties that upon such termination of any services of the Attorney, any of Client's deposits remaining in Attorney's Trust Account shall be applied to any balance remaining owing to Attorney for fees and/or expenses and any surplus then remaining shall be refunded to Client.

7 8. ASSOCIATION OF OTHER ATTORNEYS 8.1 The Attorney may, at the sole discretion and expense of the Attorney, associate any other Attorney(s) in the representation of the aforesaid claims of the Client. 8.2 The Attorney may assign or refer this case to another attorney. The other attorney may or may not be associated with the undersigned attorney. The other attorney may pay the undersigned attorney a referral fee out of the total attorney s fees paid in this matter if allowed by the professional responsibility requirements to which Attorneys are subject to. 8.3 The rights set forth in this Section are subject to the professional responsibility requirements to which Attorneys are subject. 9. TEXAS LAW TO APPLY 9.1 This Agreement shall be construed under and in accordance with the laws of Texas, and all obligations of the parties created hereunder are performable in [County, Texas]. 10. PARTIES BOUND 10.1 This Agreement shall be binding upon and inure to the benefit of the parties hereto and their respective heirs, executors, administrators, legal representatives, successors and assigns where permitted by this Agreement. 11. LEGAL CONSTRUCTION 11.1 In case any one or more of the provisions contained in this Agreement shall, for any reason, be held to be invalid, illegal, or unenforceable in any respect, such invalidity, illegality, or unenforceability shall not affect any other provisions thereof and this Agreement shall be construed as if such invalid, illegal, or unenforceable provision had never been contained herein. 12. PRIOR AGREEMENTS SUPERSEDED

8 12.1 This Agreement constitutes the sole and only Agreement of the parties and supersedes any prior understandings or written or oral agreement between the parties respecting the within subject matter. TAX DISCLOSURE AND ACKNOWLEDGMENT: THE CLIENT IS ADVISED TO OBTAIN INDEPENDENT AND COMPETENT TAX ADVISE REGARDING HIS OR HER LEGAL MATTERS SINCE LEGAL TRANSACTIONS CAN GIVE RISE TO TAX CONSEQUENCES. THE CLIENT SHOULD HAVE HIS OR HER CERTIFIED PUBLIC ACCOUNTANT OR TAX ATTORNEY DETERMINE IF THE LEGAL WORK THAT IS TO BE PERFORMED UNDER THIS AGREEMENT, HAS OR MAY HAVE TAX IMPLICATIONS OR CONSEQUENCES TO THE CLIENT OR ANY OF THE CLIENT S INTERESTS. THE UNDERSIGNED LAW FIRM AND ATTORNEY HAVE NOT AGREED TO RENDER ANY TAX ADVICE AND ARE NOT RESPONSIBLE FOR ANY ADVICE REGARDING TAX MATTERS OR PREPARATION OF TAX RETURNS, OR OTHER FILINGS, INCLUDING, BUT NOT LIMITED TO, STATE AND FEDERAL INHERITANCE TAX AND INCOME TAX RETURNS. FURTHERMORE, THE CLIENT SHOULD OBTAIN PROFESSIONAL HELP REGARDING THE VALUATION AND LOCATION OF ALL ASSETS WHICH MAY BE THE SUBJECT OF A LEGAL MATTER INCLUDING BUT NOT LIMITED TO PENSIONS, EMPLOYMENT BENEFIT AND PROFIT SHARING RIGHTS THAT MAY BE CONTROLLED BY ANY OTHER PARTY TO THE LEGAL MATTER.

9 I certify and acknowledge that I have had the opportunity to read this Agreement. I further state that I have voluntarily entered into this Agreement fully aware of its terms and conditions. Signed on. [Client s name] [Attorney s name]

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