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Featured Projects / 21 September 2018

The Great Benefits of Using a Business Contingency Lawyer in Houston

Business owners of small- and medium-sized operations understand how difficult it can be to address legal issues requiring litigation when having to pay for legal fees upfront. One effective way to ensure your business gets the legal representation it requires is by hiring a business contingency lawyer in Houston experienced with business litigation matters.

consulting with lawyerWhat Is a Business Contingency Lawyer?

A business contingency lawyer is rather similar to regular contingency fee lawyer used for personal matters, like personal injury claims. The lawyer provides a free case evaluation and consultation to determine the likelihood of winning your case. If the outcome is favorable, then the lawyer can offer services on a contingency basis.

For business owners, this means there are no upfront, out-of-pocket expenses and legal costs for retaining a lawyer. However, there could be certain legal fees that still need to be paid, like filing fees, expert witness fees, and other such fees.

What Are the Advantages of Using a Contingency Fee Lawyer?

Businesses can gain several advantages of using a contingency-based-fee lawyer for certain legal matters, including:

  • Businesses do not have to worry about financial impacts legal matters can have on their day-to-day operations. Since there are no upfront legal fees paid, your operating revenue and cash are still at your disposable to keep your business running.
  • There are low upfront costs that make retaining a lawyer easier for businesses on tight budgets. The initial costs are not that much if you are required to pay certain fees up front. Aside from these fees, there are no additional legal expenses until your lawyer wins your case.
  • There are fewer risks for businesses. If you are just earning enough to meet your business debt obligations, it is possible to get legal help while still having access to the funds to pay your business expenses.
  • Your lawyer is driven to win your case or else is not paid. Since your lawyer is not paid unless a successful outcome is obtained, there is more motivation to ensure positive results, either through a settlement or during a court trial. If your lawyer is not able to win your case, you will not have spent a lot of money on legal fees
  • A contingency lawyer helps level the playing field against wealthy competitors. When dealing with legal matter against large businesses and corporations, it can be difficult to have access to the funds for a prolonged legal battle unless you have an experienced lawyer that takes your case on a contingency basis.
  • The amount you pay your lawyer is agreed on up front. You will know exactly what percentage of the damages won that your lawyer will require for legal fees once your case is resolved.
  • The amount you pay remains the same for the duration of the case. Depending on the type of case, you may be looking at several months to several years before it is finally resolved. Knowing you do not have to worry about your legal fees increasing for the duration of the case gives you peace of mind.

Are There Any Disadvantages of Using a Contingency-Based-Fee Lawyer?

While there are many advantages of hiring a business contingency lawyer in Houston, there could be a few disadvantages you do need to be aware of, as follows:

  • Not all business legal matters can be handled on a contingency basis. Legal matters where you will not receive a monetary settlement are not normally offered on a contingency basis. Instead, you would need to pay the lawyer using a different fee payment option.
  • The standard billing rate could be less than the contingency fee. The amount owed to your lawyer after winning a business case on a contingency basis typically averages one-third of the damages recovered. Depending on the complexity of the case and its anticipated duration, it may be better to pay the standard billing rate in certain situations.

Are There Other Legal Fee Payment Options?

woman reviewing paperworkAside from paying for legal fees on a contingency basis or standard billing rate, some lawyers may offer what is known as flexible based fee options. With these options, lawyers will offer a variety of different fee schedules to help you determine which one would be best for you, your business, and your legal matter, such as:

  • Flat Fee: The lawyer will charge one set fee for your case regardless of the duration.
  • Hourly Fee: The lawyer bills for services on an hourly basis.
  • Retainer Fee: The lawyer will charge an initial fee to retain his or her services, which typically includes a set amount of hours of work as part of the fee.

Please keep in mind, with these types of fee payment options, you still have to pay your lawyers, even if they are unable to obtain successful results.

Why a Contingency Lawyer May Be the Best Option for a Business

The following are a few examples to help give you a better understanding of why hiring a lawyer who offers a contingency based fee could be the best option for your business.

Case Example 1

You own and operate a construction company. You just landed a contract to build a new condo building that includes multiple phases. In order to meet project deadlines, you have to retain the services of several outside contractors.

However, some of the contractors fail to perform their duties as detailed in their contracts, which causes delays in the project. You make several failed attempts to reach the contactors to find out what is going on. Eventually, you discover they were offered a much larger contract for another project and decided to walk off your project since they could earn more elsewhere.

Now you are facing missing promised deadlines, which could result in you in having to complete work for free. To avoid this, and in order to meet the deadlines you agreed on, you have to hire new contractors, as well as have your own employees working overtime.

These financial impacts to your business could leave your resources stretched where you do not have the money to take legal action against the contractors that failed to perform their duties as agreed on. Hiring a contingency fee lawyer allows you to file a case against the contractors without having to spend additional money on legal fees upfront.

The lawyer can work on taking legal action against the contractors that failed to perform their duties, as well as seek damages for the costs associated with paying your employees overtime and having to hire new contractors.

couple speaks to lawyer

Case Example 2

You own a small local coffee shop that has been run by your family for generations. Over the years, you have developed some rather unique beverages that are very popular with your customers. Then your customers start telling you a major corporate coffee operation is selling a knockoff of one of your top-selling beverages.

Since you are up against a major corporation, you may not have the financial resources to get into a lengthy and drawn-out legal battle. The corporate coffee company has teams of lawyers on retainer and deep pockets. It is willing to drag the dispute out until you either agree to a smaller settlement or it puts you out of business because you run out of money to keep your doors open.

You do not want to risk the financial impacts a drawn-out legal battle could have on your family-owned business. Yet, at the same time, you do not want the other company to be able to sell and earn profits off the knockoff beverage.

Getting help from a contingency lawyer would be your best option in this situation. You can go head-to-head against the corporate giant because your lawyer works on your case without any upfront legal fees.

Just remember, these are only two examples where hiring a lawyer that works on a contingency basis can be beneficial. There can be other legal situations where your business could benefit.

To get legal advice and find out if your business legal matter can be handled on a contingency basis, please feel free to contact Johnson Garcia LLP at 832-844-9700 to speak to a contingency fee lawyer today!

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