Contingency Fee Agreements: Percentages and Costs

A contingency agreement ties the attorney's compensation to a recovery defined by its terms. To understand the proposed distribution, separate the attorney fee, case expenses and any repayment claimed by a third party. A gross recovery does not by itself tell you the amount available to the client.

Scope: U.S. educational information with a limited California example. The governing state, matter and agreement control. The earlier title of this page should not be read as a nationwide 33–40% legal rate.

Check the percentage and governing rule

The ABA Model Rule 1.5 describes a written contingent agreement signed by the client, including stage-based percentages, expenses and deduction order, plus a statement when the matter ends. It is a model rule: check your jurisdiction's adopted rule and exceptions.

As a state example, California BPC 6147 addresses specified contingent contracts and fee/cost disclosures. It distinguishes negotiable fees from matters governed by BPC 6146; workers' compensation contracts are excluded. Do not apply that provision to every state or case type.

Compare deduction order

Assume for arithmetic only a $30,000 fund, $3,000 in expenses and a 30% fee. A percentage applied to gross produces a $9,000 fee and $18,000 remaining after expenses. Deducting expenses first leaves a $27,000 fee base, an $8,100 fee and $18,900 remaining. The difference is $900.

This calculation does not establish the lawful or agreed method. It omits medical liens, insurer reimbursement and other obligations. Check each item before estimating available cash, and do not count the same bill twice.

Questions before signing

Ask for written answers about the initial percentage and any change at filing, trial or appeal. Identify included services and work that would need another agreement. Ask who approves major expenses and how you can review the expense record. If representation changes or a case ends without recovery, confirm which fee and expense terms are being invoked and check the governing rule.

Request an understandable distribution

Keep the signed agreement, amendments, expense ledger and proposed distribution. A useful review sheet identifies the gross fund, percentage base, attorney fee, each expense and each third-party payment. Mark unresolved or disputed items. Ask for an explanation if an item does not match the agreement or supporting records.

For medical repayment claims, see the medical lien verification guide. A calculator cannot determine whether a fee is valid, which payment has priority or how a dispute will resolve.

Sources and date: the linked ABA and California pages were checked October 2, 2026. No attorney review or review of every state's rules is claimed.