It is not unusual for an attorney to represent a person injured in an automobile accident on a contingency fee basis. Under such an agreement, no money is required up front. Instead, the attorney is paid a percentage of the settlement or judgment when the case is over. Both the attorney and the client have an incentive to accept such an agreement. The client gets legal representation without having to pay an upfront legal fee, and the attorney has the promise of payment when the work is done.
But what happens when there is another interested party that is not privy to this contractual fee agreement – for instance, an employer that has a subrogation interest in the case due to workers’ compensation benefits paid to the client because the injury in question happened on the job? Does that third party owe a legal fee? If so, how much?
Facts of the Case
In the case of Harris County v. Knapp, the plaintiff was a man who was hit by a car while operating a lawn mower as part of his job with Harris County. The county paid out some $19,506 in workers’ compensation benefits as a result of the accident.
The employee made a negligence claim against the driver of the car that struck him. The parties reached a settlement, but an impasse arose as to the amount due to the county for its subrogation interest. The plaintiff sought declaratory relief. The county claimed governmental immunity against any declaration that it owed attorney’s fees or court costs associated with its subrogation, but the trial court denied its plea and entered an order assessing the attorney’s fee based on the recovery before deduction of the lien.
The Court’s Decision
The court affirmed in part, reversed in part, and remanded the case for a recalculation of the amount due to the employee and the county pursuant to the settlement. According to the court, the trial court properly denied the county’s jurisdictional plea of governmental immunity. The contingent fee due to the plaintiff’s attorney for his representation of the plaintiff was to be allocated against the plaintiff’s portion of the settlement after the subrogation lien amount was deducted.
The court went on to rule that the plaintiff’s attorney was also due a fee for representing the county’s subrogation interest, but that fee was to be paid separately and deducted from the lien proceeds. With regard to the county’s argument that it was entitled to a jury trial on the issue of the attorney’s fee owed for representing its subrogation interest, the court found that the trial court’s refusal to seat a jury did not amount to reversible error.
A Knowledgeable East Texas Car Wreck Lawyer Here to Help
Issues such as an employer’s workers’ compensation subrogation interest can complicate an otherwise straightforward automobile accident case. An attorney knowledgeable in these matters can be of great assistance in resolving such disputes in a manner that maximizes an injured person’s recovery. To schedule a free consultation with an experienced east Texas car accident attorney, call the Law Offices of Earl Drott, P.C. at (903) 531-9300. We serve all of east Texas, including Smith County and the city of Tyler.
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