How Do Lawyers Really Get Paid for Injury Cases in New Jersey?

“No Fee Unless We Win!” — What Does That Really Mean?

You’ve seen the billboards: “No Fee Unless We Win!” But what counts as a win? If your case is worth $500,000, yet you’re pushed into a $100,000 settlement, is that truly a win for you? Here’s the secret – it’s nothing more than a marketing headline. The truth is simple: if any money is recovered, your lawyer takes a fee. Understanding how these agreements actually work is key to protecting your recovery.

Contingency Fee Basics: The Trade-Offs

The basic contingency fee agreement requires the law firm to advance case expenses. If the case results in a payout, the lawyer’s expenses are reimbursed, and the fee is a percentage. A quick example to illustrate the math, assuming a $100,000 settlement in a case that required the law firm to advance $10,000 of case expenses:

$100,000 Settlement

($10,000) Case expense reimbursement to lawyer

$90,000 Net settlement

($30,000) 1/3 attorney fee

$60,000 Client’s net recovery

Law firms devoted to handling injury claims with a client-first mindset generally should not ask you to pay a fee unless you are first receiving money. 

• What you gain: Access to the courts without paying upfront.
• What you avoid losing: If no payout, you typically don’t owe attorney fees or expenses.
• The trade-off: Even if the payout is less than the real value of your case, your lawyer still takes a percentage.

The arrangement shields you from paying for a case you lose, but you need to be sure your recovery isn’t undervalued.

How Much Does a Lawyer Take From a Settlement in New Jersey?

Every state governs the contingency fee percentage that attorneys can charge. By law in New Jersey, attorneys in most personal-injury cases cannot charge more than one-third (33⅓%) of your recovery. Here’s the advantage: whether you hire a lawyer with 30 years of trial experience or one just out of law school, the fee percentage is exactly the same. You don’t risk losing more of your recovery by choosing the lawyer with proven results. That means you can make the safe choice—hire the lawyer with the experience and track record to maximize your outcome—without worrying about higher fees.

Why Choosing the Right Lawyer Matters

Since a contingency fee arrangement determines the lawyer’s fee as a percentage of the payout, the fee calculation is the same regardless of who does the work. Like most industries, law firms use different business models. Some law firms operate on a volume basis, handling cases in an assembly-line manner, with heavy staffing of non-attorneys. Some law firms are attorney-driven with less reliance on non-attorney staff. 

• The risk: High-volume firms may process cases quickly, leaving money on the table.
• The benefit: Attorney-driven firms invest time and strategy to maximize your recovery.

Since fees are based on a percentage, every firm looks the same on paper. The difference is in the results. When choosing a law firm, you should ask about the business model, how the legal team is organized, and who will be the lead attorney for your case.

Case Expenses: Avoid Hidden Costs

Expenses required to file claims and litigate these cases come in many different shapes and sizes. On the lower end, some legal notices must be sent by certified mail, which requires expenses beyond the cost of a postage stamp. On the other end of the spectrum, a trial involves the use of expert witnesses who charge many thousands of dollars for their services. Law firms that haphazardly agree to handle cases or lack confidence in their ability to recover money, or do not have sufficient financial resources, may ask the client to cover case expenses upfront. This should raise concerns about whether the law firm is a proper fit for your case. Generally, if your case has merit, you will find a law firm that does not require you to advance any case expenses.

• The risk: Some firms ask clients to advance these costs, putting you at financial risk.
• The benefit: The right firm covers expenses upfront, and you only repay if money is recovered.

This distinction protects you from paying out of pocket for a case that may not succeed.

Hammer Clauses: Who Controls Your Case?

Most contingency retainer agreements have terms affectionately known as the hammer clause. If a law firm advances all expenses, it has a significant stake in the successful resolution of the case. The typical hammer clause states that if the law firm recommends acceptance of a settlement offer and you disagree, the law firm can then require you to start advancing expenses. This has a legitimate purpose, but it is also abused. For example, assume the law firm has correctly positioned the case, receives a settlement offer exceeding the customary case value, and recommends settlement to the client. If the client’s approach is that there is nothing to lose since the law firm bears all risk for time and expense, it may be appropriate for the client to have some skin in the game. However, some law firms use this clause to pressure clients into accepting unreasonably low settlements because they don’t want to invest the time or money necessary to handle the case properly. 

• When it’s fair: If you reject a strong offer, sharing costs can be reasonable.
• When it’s harmful: Some firms misuse this clause to pressure clients into low settlements to save themselves time and money.

Asking upfront how a firm handles this clause helps you maintain control of your case.

One Shot at Justice—Make It Count

In New Jersey, injury cases often take three to five years. That’s a long journey with one opportunity to get it right. Choosing the wrong lawyer can mean years of frustration and a smaller recovery. Choosing the right one ensures you avoid hidden losses and protect your future.

Talk to RAM Law About Your Case

At RAM Law, we advance all expenses, never pressure clients into low settlements, and focus on maximizing recovery. If you’re comparing law firms for your injury case, schedule a consultation with us to see if we’re the right fit for you.

Call (908) 448-2560
Email erebenack@ram.law