Question

In: Finance

Most personal injury claims are handled by attorneys on a contingent fee basis. In other words,...

Most personal injury claims are handled by attorneys on a contingent fee basis. In other words, the attorney receives an agreed percentage of the recovery. Is it likely that there would be less personal injury claims, if clients had to pay an attorney's hourly rate in order to pursue their claims?

(Please don't hand write).

Solutions

Expert Solution

To understand the answer to this question we need to understand the mindset of the attorney.
Majority of Attorney is sitting over there to do business and earn for themselves. Their motivation is:

Factor 1. How can earn from this present case?
Factor 2. How can I use this can as leverage to get future cases?

For an attorney, his track record and status is most important. That's why attorney firms do probono from time to time. That's their way of showing to society that they care for them at the same time Branding their image.

Factor no. 2 is most important for am attorney. Because based on factor number 2 his factor no. 1 is determined.

If the attorney handles the case on a contingency fee basis then he has motivation from both the factors hence he will work with extra motivation.
Contingent fees are just an add on to motivation but not the motivation itself.

But at the same time, he gets hourly-paid - his motivation will almost remain the same if he is a good attorney.

Now coming to personal injury claims: There will be a slight fall in personal injury claims, not a drastic change.


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