You are, of course, not my Australian lawyer. However, my SO may soon be hiring one for a suit against a hospital. To ensure that the lawyer we're hiring is the kind that we think we're hiring, she's asked me what the difference (if any) is between a no-win, no fee lawyer, and a lawyer that is hired under a contingency agreement.
I don't pretend to be anything even remotely close to An Lawyer, but as I understand it, the difference is essentially as follows:
- A contingency agreement means you're on the hook up front for things like court costs, medical reports, investigators. You're not paying for the lawyer's own time and labour, but are paying for the cost of bringing the case to trial in the first place. Basically the same sort of costs you'd be paying if you represented yourself. If you win, you get your costs back as part of the settlement, and the lawyer is paid a pre-negotiated percentage of the settlement to cover their time and labour. If you lose, you're out your court costs, and may still be liable for the costs of the other party.
- A no-win no-fee lawyer, by contrast, covers all of the establishment costs of a suit up front. It doesn't really cost you anything to bring the case to court, and if you win the lawyers fees and disbursements (including court costs) are then established, negotiated, and deducted from the settlement amount. If you lose, you may still be liable for the costs of the other party, but the lawyer eats all the establishment costs, as well as their own time and effort.
Am I mistaken in this understanding? Is there something important I'm missing? I've heard Australian stories
about shady no-win no-fee lawyers ratcheting up those costs and expenses, but in general what would be the advantage of hiring a contingency lawyer rather than a no-win no-fee lawyer? An expectation of a larger settlement at the back end? An expectation of more professional representation? What am I missing?