Paying a lawyer on contingency means that the plaintiff agrees that the attorney's fee will be determined by the amount of the settlement awarded to the plaintiff, should the case be won in the plaintiff's favor. If the plaintiff does not win the case, the attorney will receive no fee.

Many people falsely believe if they lose the case they will not have to pay anything. Though they will not have to pay the attorney's fee, they will still be responsible for expenses their attorney incurred in pursuing their case. These fees might include medical reports, investigative services, expert witnesses, court costs and court reporter fees, etcetera.

What you won't have to pay if your arrangement is to pay your lawyer on contingency -- and you lose the case -- is for the lawyer's time and labor.

However, even if you win the case you will still be responsible for the expenses incurred to try your case. So win or lose, the cost of bringing your claim to court will come out of your pocket.

When you agree to pay a lawyer on contingency, the fee is set at a prearranged percentage of whatever the awarded amount might be. This can add up to much more than the normal fee the lawyer would have earned, however there are many advantages to paying on contingency:

• If you lose the claim you don't pay the lawyer at all.
• If you win but the award is paid over time via a structured settlement, you only have to pay your lawyer as you get paid.
• If you can't afford to pay an attorney, paying on contingency will not only get you an attorney, but you can get a very expensive attorney.
• Your attorney will arguably work harder for you if paid on contingency because his or her fee is at stake.
• Since your lawyer will not be getting paid by the hour, you can have more interaction without being worried about "watching the clock."
• If paying by the hour the defense could employ delay tactics to exhaust your funds.
• If paying by the hour any attorney might take your case whether or not it could be won. A lawyer who agrees to payment on contingency believes your case is winnable.

The only downside to paying on contingency is that you will have to give up a sizeable percentage of any award or settlement. Any unpaid expenses will also come out of your share of the award. However, considering it is a way to secure excellent representation that would normally be out of financial reach, to pay a lawyer on contingency remains an option many people choose when looking to the courts to settle personal injury claims or other cases that involve large awards.

As always, make sure you fully understand any legal agreement or arrangement you enter into with a lawyer before you commit. Your attorney's policies supersede any information in this article which is only meant to be generally instructive. If possible, get someone with legal knowledge to look over any contracts before you sign them.