Frequently Asked Questions

Education is when you read the fine print. Experience is what you get if you don't.
- Pete Seeger

 

What is a contingency fee contract?

A contingency fee contract is a contract between attorney and client where the attorney is paid for their services with a percentage of the money recovered for the client.

Who is responsible for costs?

The client is ultimately responsible for costs. The attorney may advance certain costs on the client's behalf, or may require the client to advance the costs before committing the obligation. In some instances, the costs may be paid for out of the client's portion of the recovery. Under Texas law, any contingency fee arrangement between attorney and client should be reduced to writing, and the basis for allocating costs set forth in the contract.

What is a straight time contract?

A straight time contract is a contract between attorney and client where the attorney is paid for their services on an hourly rate basis. Other billable services, such as paralegal support services, may also be included in the contract.

Are there other means of engaging legal services?

Some services may be performed on a fixed fee basis, where a specific service carries a specific fee. Other services may be performed on a mix of contingent fee and straight time.

When would a particular fee arrangement be applicable?

A contingent fee contract usually applies in litigation where liability and damages are clear but collection may be questionable, or where liability and damages are questionable but collection is clear. There the attorney is taking the risk of failure.

A straight time contract applies in litigation, where the services are in defense of the client, or where there is little, or no, chance of a monetary recovery under any circumstances. It is also used in transactional matters; i.e. contract preparation, purchase and sale of a business, etc.

A mixed fee contract applies in litigation where both liability and damages, and chances of collection are questionable. There both attorney and client share a portion of the risk of failure. Both the fees for straight time, and the contingent percentages, are reduced from their usual levels.

Are there other types of fee arrangements?

There are contracts where attorney's compensation is tied as a bonus to performance; e.g. defending a claim for damages of $100,000.00 and getting it reduced to $25,000.00 with the attorney getting a percentage of the reduction from the original claim. That is a type of bonus reverse contingency fee contract, and is usually tied to a straight time contractual basis at a reduced rate.

Are there means of settling disputes other than through litigation?

The most popular alternate methods of dispute resolution are mediation and arbitration. Mini-trials are also used on occasion.

What is mediation?

Mediation is a method inducing all parties to reach a mutually satisfactory settlement.  It is a purely voluntary procedure, and becomes binding only when a settlement agreement is reduced to a document signed by the parties. The mediator's function is to facilitate the possibility of settlement.

What is arbitration?

Arbitration may be compulsory, if made a contractual requirement between the parties. There the parties present their arguments and evidence to an arbitrator, or a panel of three arbitrators, and the arbitrator(s) make a ruling as to what the judgment will be. That judgment, made by the arbitrators, is final and not appealable, save for very limited and complex circumstances.

What is a mini-trial?

A mini-trial is a procedure where the parties present their arguments, and provable evidence, to a panel of experienced lawyers. The panel then presents their opinion as to what the results would probably be if presented to a judge and jury in a formal trial. That opinion, although not binding, frequently leads to settlement discussions between the parties.

Why do I need an attorney?

You don't! The law allows individuals to represent themselves in litigation. But litigation is procedurally complex, and a misstep could cost you the lawsuit. The only safe area is in Small Claims Court, where the rules are waived for the individual.

When you engage a lawyer, you are getting an individual who is bound to zealously advocate your position, and who bears a fiduciary duty to you. The lawyer is either knowledgeable in the area of practice so engaged, or will become competent in that area of practice in order to properly handle their duties to you.

Unless you are willing to put forth the time and effort to become competent in the areas of law and procedure that apply, so you can conduct yourself with the same competence as an attorney, engaging a lawyer is the surer and safer course of action.

How do I find an attorney?

Speak with friends and acquaintances that have had similar problems, and see if they've used an attorney to help resolve the matter. If so, were they satisfied with the services rendered and would they recommend that attorney? Speak with others that have had to use an attorney, and see if they'd recommend that attorney. If recommended, speak with the attorney and see whether they handle matters similar to yours, and whether you feel comfortable with that attorney or law firm.

If the attorney does not handle matters similar to yours, ask if they can recommend other attorneys that may handle matters similar to yours. Then speak with those that are recommended, continuing the process until you have an attorney, or attorneys, with whom you feel comfortable.

Will an attorney tell me what to do?

An attorney is a counselor. They can advise on the legal ramifications of a given course of action, and explain what risks may be associated with that action. They can examine options and advise which options carry the greater or lesser risk. Decisions, other than decisions on purely legal matters, are always left up to the client. Decisions on legal matters are reserved to the attorney, although those decisions are usually discussed with the client beforehand.

What is a Limited Liability Company?

The limited liability company [hereinafter LLC or LC] is neither a corporation nor a partnership; rather, it is a distinct type of entity that shares the characteristics and powers of a corporation and a partnership. The owners of an LLC are called "members"; the provisions relating to the management of the affairs of the LLC are called "regulations".

Members may be individuals, partnerships, corporations, and any other type of legal entity. Under the provisions of the Texas Tax Code, a limited liability company is subject to state franchise tax. The business of an LLC is controlled by an internal company document called an Operating Agreement.  That document is roughly the equivalent of a corporation’s bylaws

RETURN