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What Does "No Win, No Fee" Mean?

We understand that many people have reservations when they hear “No Win, No Fee.” It sounds too good to be true, and skepticism sets in. People often question whether there's a catch–can you really get competent legal services without paying upfront? In this article, we delve into the “No Win, No Fee” agreement and break down the facts in hopes of shedding light on how this payment model works.

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Definition of “No Win, No Fee”

“No Win, No Fee,” also referred to as working on contingency or on a contingency fee basis, is a payment arrangement between a client and a personal injury attorney. Under this agreement, the attorney’s fees rely (i.e., are contingent) upon the outcome of the case. Simply put, the lawyer only gets paid if they win the case or secure a settlement for the client. If the case is not successful, the client does not owe any legal fees to the attorney. 

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How It Works in Tennessee

In Tennessee, as in other states, contingency fee arrangements are common in personal injury cases. This is particularly beneficial for clients who may not have the financial resources to pay an attorney upfront. You may think of it as similar to hiring a professional tax service to ensure your taxes are properly filed and you receive the highest return, then paying out of your return rather than out of pocket. 

Tennessee Supreme Court Rule 1.5 gives guidelines for lawyers to follow when setting their fee structure, making it clear that no lawyer should “make an agreement for, charge, or collect an unreasonable fee or an unreasonable amount for expenses.” In the case of a successful resolution, most attorneys who work on a contingency basis charge around 1/3 of the final settlement.

Here’s how it typically works:

  1. Initial Consultation: The McMahan Law Firm offers a free initial consultation where you can learn about your case’s viability and its potential value. We will guide you on your next best steps to take.
  2. Agreement: The client and attorney agree that the attorney’s fees will be a percentage of the settlement or court award. This percentage is usually agreed upon before the attorney starts working on the case.
  3. Case Pursuit: The attorney proceeds with the case, investing their time and resources without any upfront payment.
  4. Case Resolution: If the case is won or settled, the attorney receives a percentage of the compensation as their fee. This percentage is predetermined and outlined in the agreement.
  5. No Win, No Fee: If the case does not result in a win or settlement, the client does not pay any attorney fees.

Benefits of “No Win, No Fee” Arrangements

Working on contingency provides a variety of benefits to those seeking compensation for their losses after a serious accident. These include:

  1. Access to Legal Services: After an accident, when you’re dealing with pain, stress, and bills piling up, the added expense of an attorney can seem like too much. Working on contingency allows everyone, even those who are low on funds, to seek legal representation they deserve.
  2. Risk Mitigation: One of the key advantages for clients is that they do not bear the financial risk of losing the case. In the event that the case is unsuccessful, clients are not obligated to pay any fees or expenses related to the legal proceedings. This provides clients with an added layer of financial protection and peace of mind throughout the legal process, knowing that even if their case is unsuccessful, they will not have to pay their lawyer out of pocket.
  3. Incentivized Performance: Under a “No Win, No Fee” arrangement, attorneys are motivated to work diligently on each case as their payment directly depends on the successful outcome. This incentivization structure not only ensures their commitment, but also aligns their interests with the best interests of their clients. By linking compensation to the results achieved, attorneys are driven to go above and beyond, leaving no stone unturned in their pursuit of justice.

Don’t Let Your Finances Stand in the Way of Justice

“No Win, No Fee” agreements in Tennessee offer a viable path for individuals seeking justice in personal injury cases without the burden of upfront legal fees. This arrangement aligns the interests of the client and attorney towards a common goal–a successful resolution of the case. However, it’s important for clients to fully understand the terms of the agreement, including the percentage of the contingency fee and responsibility for other costs. 

Consulting with a knowledgeable personal injury attorney from The McMahan Law Firm for a free case review can provide clarity and ensure that your rights and interests are well-represented in your pursuit of fair compensation.