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Playing It Safe with Low Conditional Fees versus Being Insured by High Contingent Fees
2004
Social Science Research Network
Under contingent fees the attorney gets a share of the judgment; under conditional fees he gets an upscale premium if the case is won which is, however, unrelated to the adjudicated amount. We compare conditional and contingent fees in a framework where lawyers choose between a safe and a risky litigation strategy. Under conditional fees lawyers prefer the safe strategy, under contingent fess the risky one. Risk-averse plaintiffs prefer conditional fees over contingent fees when lawyering costs are low and vice versa for high lawyering costs.
doi:10.2139/ssrn.633021
fatcat:apkrafny4jc6djdrtqrzo4wqqe