One bad apple can spoil the whole bunch. Likewise, a few greedy lawyers can make all lawyers look bad. Here’s a prime example.
First some background. We New York personal injury lawyers generally charge a 1/3 contingency fee. Sometimes we work our asses off and the case goes south or we get a very small settlement or verdict. Cases that look good at the start can quickly sour when the other side pulls out its evidence. In those cases our per-hour fee can end up being a buck hour or less.
On the other hand, sometimes we get a great result for not-so-much work, and can earn a huge hourly fee. It all evens out in the end and we make a decent living, even a very good one if we are very good at what we do (we are!).
There are exceptions to the standard 1/3 contingency fee, though. One of them is when the injured plaintiff is an “infant”, defined by law as anyone under the age of 18. When settling an “infant’s” case, New York law requires court approval of both the amount of settlement and the amount of the fee. In my experience, Central New York judges won’t allow for a 1/3 fee in an infancy case unless (1) the lawyer has brought the case all the way to trial or (2) the case involved more legal work than is customary for a personal injury case.
For example, if a lawyer takes the case as far as depositions, and then settles before trial, the Court is likely to grant the attorney a 25% contingency fee, maybe 30%, but no more.
We at Michaels & Smolak make it a practice to request only a fee that we believe the judge will deem fair for the infant. As a result, our fee requests in infancy cases have never been rejected.
Apparently not all law firms follow this practice. In a case recently discussed in the New York Law Journal, C.M. v. Syosset (11-cv-01402) a judge recently referred a Long Island law firm to an attorney disciplinary committee after finding the firm’s fees were not only too high, but they failed to disclose the true amount.
How high were the fees the attorneys failed to disclose? Guess.
Nope, guess again.
Not even close.
FOUR TIMES THE AMOUNT OF THE SETTLEMENT!!! That’s right, the infant had to pay the lawyer 4 times what he got in settlement. This incredible fee was based on a combination of contingency and hourly payment calculations.
When the judge got wind of the fee, he called it “wildly disproportionate” and ordered most of it disgorged.
In my opinion, they should also be ordered to disgorge their law licenses. Getting rid of the bad apples spares the whole bunch.
Email me at: email@example.com I’d love to hear from you!
Michael G. Bersani, Esq.
michaels-smolak.com Central and Syracuse NY Personal Injury Lawyers
Michaels & Smolak, P.C.