Paralegal Advanced Competency Exam (PACE) Practice Exam

Which is a key feature of the contingency fee arrangement?

1. It involves upfront payments

2. It is contingent on the client's success

3. It is negotiated annually

4. It applies to criminal cases only

The correct answer is: It is contingent on the client's success

A key feature of the contingency fee arrangement is that it is contingent on the client's success. This means that the attorney's payment is dependent on the outcome of the case; if the client does not win or settle the case successfully, the attorney typically receives no fee for their services. This arrangement aligns the interests of the attorney and the client, as both parties benefit from a successful outcome. The contingency fee structure is commonly used in personal injury and other civil litigation cases where the client may not have the resources to pay for legal services upfront. By using this model, clients have access to legal representation without the risk of paying large sums regardless of the case's outcome. In contrast, other pay structures, such as hourly billing or flat fees, do not have this inherent connection to the success of the client's case.