Attorney Fees

Attorneys are allowed to charge for work done in two different ways:

  • An hourly tariff as agreed between the attorney and his/her client, or
  • A percentage of compensation recovered for the client. (Contingency Fee)

Attorneys are also allowed to recover their expenses paid out on your behalf in their management of your case.

Before you agree
The most important thing to remember is to insist on a written agreement with your attorney so as to avoid later disputes.  Don’t feel rushed into signing the agreement – take it home, consider the agreement and bargain with your attorney if you’re unhappy with some of the terms.

Hourly tariff
The agreed rate between an attorney and his/her client is exactly that – agreed. The client is free to negotiate with the attorney and to bargain for a lower hourly rate. If the attorney’s rate is, in your opinion, too high, then ask yourself whether the same job can be done as well for cheaper and if so, look for another attorney.

The rates of attorneys vary according to the experience and level of expertise. You may be charged R450 per hour for the services of a newly qualified attorney, whereas if you have an attorney with a lot of experience at your service, expect to be charged anything from R800 to R4 000 or more per hour.

Contingency fee
(Also referred to as “Success fee” or “No-win no-fee”)
In most personal injury cases and in many other damages claims you will be able to find an attorney who is prepared to take on your case on a contingency basis. A contingency fee is either an agreed higher fee in the event of success or a fee calculated as a percentage of the recovered compensation.

The rationale behind the contingency fee is the following:

  • Most people can’t afford to pay for an attorney.
  • Most people can’t afford to pay the expenses incurred in running a case to trial.
  • The attorney has to take on the matter with a possibility of receiving nothing for all his efforts which in turn entitles him to a greater remuneration in the event of successfully finalising your claim..
  • Clients are assured of the attorney’s best efforts to
    • Finalise the claim as quickly as possible; and
    • Recover as much compensation as possible.


The practice of attorneys charging contingency fees was formally recognised in 1999 with the promulgation of the Contingency Fees Actwhich seeks to govern this area of attorneys’ fees. The act makes it clear that attorneys are limited to 25% of the compensation recovered and limited to double the normal fee (agreed between the attorney and his/her client).  A client is also entitled to refer the fee and the agreement to the relevant law society for review in the event of a dispute. Contingency Fee agreements which provide for a fee in excess of the 25% of compensation are not necessarily invalid. For a discussion on the application of the various kinds of contingency fee agreements see the Law Society of the Northern Provinces’ guidelines.

The approved form of the agreement referred to in the act is often not followed by attorneys. However as is noted in the guidelines above, if the agreement gives effect to the spirit of the act then it will most likely be enforced.

If you are about to sign a contingency fee agreement make sure that your attorney has shown you his “normal rates” so that you know what you are agreeing to, and, most importantly remember that you are not compelled to agree to the terms proposed in the agreement – Bargain for a better deal, or look for a reputable attorney who may agree to your terms. (Always remember to be reasonable in your negotiations – a wise man once said “you get what you pay for”).

Value Added Tax (VAT)
The contingency fee agreement concluded with your attorney will indicate whether the percentage is inclusive or exclusive of VAT. Usually your attorney will levy the VAT in addition to the agreed percentage. This amount will be paid over to the South African Revenue Services.

Expenses
Expenses can include anything which is not a fee and for which the attorney has to pay. These may include:

  • Travelling expenses
  • Cost of copies
  • Postage costs
  • Witness fees
  • Medico-legal expenses (paying experts for reports)
  • Payment for medical records and reports
  • Payment for copies of police records
  • Revenue stamps (summons)
  • Advocates fees
  • Correspondent charges (If it is necessary to appoint an attorney in another jurisdiction you will be charged for this expense.)

Will the other party pay my costs if I’m successful?
In most cases the other party will be liable to pay your costs on a lower scale than that agreed between you and your attorney. These recovered fees are referred to as Party-and-Party fees, and are usually much less than your attorney will charge.

Based on the content of your file, a bill of costs is drawn up after the matter is concluded. The bill is then presented to the other party and if disputed adjudicated upon by a taxing master (of the court)
You should always bear in mind that some expenses will not be allowed by the taxing master (such as interest charged on expenses paid and part of your correspondent account) and that this will ultimately be deducted from your capital after deduction of the contingency fee.

Depending on the terms of your agreement with your attorney, you should be credited with the Party-and-Party fees recovered.

You should be credited with all of the expenses that are recovered. A large portion of your medico-legal expenses and other out of pocket expenses should be recovered for which your attorney should credit you.

How much will I get out?

If you have agreed to a 25% contingency fee, you are likely to receive between 75% and 70% of your capital at the end of the day.  The additional amount is for the unrecovered expenses which may be added to the agreed fee.

Remember to insist on a detailed account wherein your attorney sets out the expenses incurred and recovered and also indicates how that matches up with the terms agreed upon in your contingency fee agreement. 35% sounds like a lot to part with.

You should always bear in mind that most cases require the investment of a lot of time and also money in the form of payment of medico-legal experts for their reports and numerous other expenses to prove your claim (for which there is the risk of non-recovery).

Bear in mind that your attorney is putting a lot on the line to assist you and that had he/she not been prepared to take your matter on risk you would, in all likelihood, not have been able to afford an attorney in the first place. The benefit and risk have a value and your attorney should be compensated for taking that risk and providing the benefit.

Remember to bargain at the beginning (when you sign your fee agreement) for favourable terms. If your claim is likely to be a big one, your attorney will be more flexible because he/she wants your claim. Whilst most attorneys will tell you they’re the only ones who will be able to do the job properly you are free to shop around. You will most likely find that there are many top notch attorneys prepared to assist you.

Also remember that your contingency fee agreement is reviewable. If the amount is completely out of line with the work actually done, ask for the account to be reviewed by the relevant provincial law society.

Contact Details

Phone Phone: (012) 809 1588
Fax Fax: (0) 86 603 0097
WWW Link Website: www.claims4u.co.za
Email Email:info@claims4u.co.za
Address: Block 2, Lombardy Business Park,
Cnr Cole & Graham Rds, Lombardy , Pretoria