Factors Affecting Lemon Law Attorney Fees
Not All Lemon Law Attorneys’ Fees are Created Equal
Just as each lemon is different, so too are the fees different for each lemon law attorney. When it comes to the fine print about fees, most practitioners have terms in their retainer agreements that signify they will seek reimbursement for fees and costs from the manufacturer or dealership when they win the case. However, to understand what an attorney’s bill will look like if you lose it is important to examine the factors that impact the total fees, including the jurisdiction, complexity of the work, method of payment, and reputation/experience of the attorney.
Location Matters
One of the most obvious factors that can impact the cost of an attorney’s fees is location. It is no secret that the cost of living is drastically higher in big metropolitan cities than it is in rural areas. Lemon law attorneys are like other professionals and the average hourly billing rate carries with it a reflection of the attorney’s overhead to continue in business. In more urban areas, such as New York City or Los Angeles, attorneys may need to charge over $500 an hour because the expenses for keeping an office there are so high. Conversely, in rural areas where costs to maintain office space is lower, a good lemon law attorney may charge an hourly rate of about $200 per hour.
The Complexity of the Case
The next factor that should not be overlooked is the complexity of the case. Some lemon law cases are cut and dry where the lemon is clearly defined in black and white terms in the statutory definitions of lemon laws. However, there are some situations where it is necessary to take a closer look at the issues involved rather than just quickly saying that the vehicle was a lemon because the electric window would get stuck . In an advanced lemon law we may need an auto engineer to go out and inspect the vehicle to determine why the window gets stuck time and again. In these cases, the lemon law attorney knows the case may take more time and be harder to prove, and thus should charge a higher hourly rate or establish a higher contingency fee.
Some Ways Lemon Law Attorneys Charge Fees and Recover Costs
While lemon law attorneys should not charge consumers a retainer or an upfront fee for their work, they may receive a flat fee ($10,000) that they obtain from the manufacturer to handle the case. This fee may be a combination of fees for work done on a case taking on the risk of $15,000-$20,000 in work where the lemon law attorney may not be paid. Some lemon law attorneys may require a contingency fee upfront, whereby they will charge the consumer $1,000 to $5,000 upfront and then take a percentage of the recovery, but they take the risk they will not be able to get a recovery from the manufacturer.
Reputation Matters
Lastly, the reputation or experience of the lemon law attorney may impact factors such as the contingency rate, hourly rate, and/or upfront fee. A top tier lemon law attorney (who wins a high percentage of cases and gets a big recovery for their clients) may charge a higher percentage in a contingency agreement (usually around 50%) than a less experienced attorney (who may charge 33%). Of course, this higher fee is because the top tier lemon law attorney asserts more effort is warranted in the representation of the client given their high level of expertise, resulting in a higher contingency fee.
Common Fee Structures for a Lemon Law Attorney
A lawyer, like most other professionals, may charge in a variety of ways. Using an hourly rate is typical in the industry. But with potentially expensive lemon law cases, an hourly rate may be restrictive. A lawyer may also use a flat fee for a case. This is more common for a case that has a set requirement.
Contingency fees for lemon law cases are a riskier proposition for the lawyer. Most lemon law cases with an hourly fee are repetitive. A case that has a flat fee is usually similar to another case. A contingency "fee" is unusual because the lawyer does not get paid if the case is unsuccessful. Giving up hourly billing time or flat fees makes these fees unusual and risky. But some lemon law lawyers charge on contingency because it brings them more cases.
When a lemon law lawyer charges on contingency, this fee structure can bring in a lot of money for him or her. Lemon law lawyers see different kinds of clients. A client may be in financial difficulty or need immediate cash. If the lemon law lawyer takes these cases on contingency, a lot of cash could flow into the firm. And in lemon law cases, the cash often flows quickly.
The lemon law §§ 1793.2(c)(2) and/or the soft consumer fraud §§ 17535 and 17536 provide for the consumer’s attorney to get attorney’s fees. The lemons will fail for no apparent reason and leave the consumer without a car. Or the consumer may have just purchased a brand new vehicle only to have it break down a few times in quick succession. Either way, the lawyer needs to spot the lemon. When a lemon case is a winner, the lawyer should be rewarded. On the other hand, if the consumer loses the lemon law case, the attorney gets nothing.
Most lemon law cases are taken on contingency. Most of the time, the consumer does not have to pay the attorney unless the case is successful. If the case is successful, the client wins all costs spent on the case and attorney’s fees will be paid by the auto maker.
Just because lemon law § 1793.2(c)(2) provides for the consumer’s reasonable attorney’s fees is not the only way to get a lemon law case started. Some lemon law attorneys, like the author, put a low retainer down for the first step in the action and then a 1/3 contingency fee for the very end of the action.
An attorney’s retainer may be used for consultation, advice, research, and drafting. The retainer may last for a month or even three months. After the retainer is used, the attorney will take the case on contingency.
This fee system is very common and many reputable firms use it. There will be a retainer and then a contingency fee. Generally, once the retainer is exhausted or expires, the attorney will take the case on contingency. So the client will not pay attorney’s fees and costs if the case is unsuccessful.
Most lemon law attorneys will charge a fixed fee, a retainer fee, or a contingency fee. The new car lemon law § 1793.2(c)(2) calls for the consumer’s reasonable attorney’s fees to be paid by the car manufacturer. The California lemon law attorney or lemon law firm will normally receive a large portion, if not all, of that award from the lemon law §§ 1793.2, et seq.
The lemon law attorney retainer fee or the contingency fee is one way to obtain the lemon law service. The easiest way to obtain the lemon law service is a contingency fee system. And in lemon law cases, the fees are normally very high due to the statutory sanctions and attorney’s fees allowed lemon law attorneys.
Average Legal Fees by State
Beyond California, lemon law attorneys charge different amounts all over the country. The costs can vary quite a bit depending on what type of lemon law claim you are bringing and where you live. Since many state lemon laws have some sort of fee shifting provision, and in most cases under California’s lemon law you don’t have to pay your attorney directly, clients might not be aware of how much their lemon law attorney is charging. There is no reason not to be aware though, and there may be ways to lower your bill that you can do yourself that your attorney may not have mentioned (for example, try and understand what you can do at home yourself, like documenting the situation in a notebook, to save time at the shop). If you want to be an informed consumer, you should be aware of what lemon law attorneys assets (that is the monetary value of the car at issue) are being requested.
Georgia
Georgia lemon law attorneys expect to be paid $250 per hour to litigate lemon law disputes if they don’t win in Georgia. Georgia requires that both sides pay their own attorneys’ fees. It does take time to litigate lemon law disputes so if your car is valued at $30,000 you will likely have a $15,000 bill.
Washington
Washington lemon law attorneys charge $200 per hour. Washington, like Georgia, requires that you pay your own way. Again, it takes time to litigate lemon law disputes in Washington.
Virginia
Virginia lemon law attorneys charge $225 per hour. Virginia, also like Georgia and Washington, has no provision for shifting attorneys fees.
Texas
Lemon law attorneys in Texas charge $450 per hour. Like other states mentioned above, Texas does not have a fee shifting provision.
Louisiana
Louisiana lemon law attorneys charge $350 per hour to litigate lemon law disputes. Louisiana does have a fee shifting provision. Louisiana lemon law attorneys have the option to elect for their fee on a 100% contingency.
Minnesota
Minnesota lemon law attorneys charge $250 per hour. Minnesota lemon law attorneys have the option to elect for their fee on a 100% contingency.
Massachusetts
Massachusetts lemon law attorneys charge $225 per hour. Massachusetts lemon law attorneys have the option to elect for their fee on a 100% contingency.
Additional Legal Costs
In addition to the costs I already mentioned above, clients should also be aware of potential additional costs associated with the lemon law process. The most significant of these will be court costs. If your case ends up going to court rather than being settled, then you will typically have to pay certain fees to the court based on the type of filing. For example, many state courts will charge a filing fee, as well as fees for serving the complaint and any subsequent filings on the other party. Most courts also charge fees for reporting services, as well as for the filing of transcripts.
Expert witness fees are also considered to be additional out-of-pocket costs. In some lemon law cases, such as breach of warranty claims , there are certain issues that cannot be sufficiently explained to the judge or jury without the expert testimony of engineers and other professionals. If expert testimony is needed in your case, the attorney will have to hire these experts and pay them to testify, which are typically paid for through expert witness fees.
There are also document-related costs. Clients are often required to pay for the photocopying of certain documents that they request, so long as the attorney does not have to create new documents to meet that request. Clients may also have to pay for the transcription of testimony, which is generally done by private transcription companies rather than the court itself. In both instances, the attorney will be responsible for the disbursement of these costs, and will then typically bill them to the client.
How to Reduce Legal Fees
It is true that some lemon law firms charge those they represent by the hour. But this can be a costly and frustrating experience since it requires close monitoring of the time consumed and prevents any sort of simple or fast resolution to a claim.
Fortunately, every lemon law firm helps clients solve their problems for free and will not require fees unless they win the case. This is not a coincidence. The firms want to get the whole issue behind them, not racking up time along the way while putting the client in more debt than ever.
Firms that bill by the hour are likely to make your legal troubles worse, stretching out the case and charging you as much as possible before the door swings shut, never to be re-opened. It’s best to avoid them altogether and work with a firm that has incentive to reach a solution as quickly as possible.
For those looking for ways to keep costs down, there are a few other things you can do in general, whether it is a lemon law case or not. For instance:
- Simple advice on how to speak face-to-face with dealers, manufacturer representatives and others can prevent emotional arguments;
- If you have a case that demands some cost (for example a lemon law that is not yet enacted in a state), you may be able to negotiate the price, the same as in everything from a car purchase to a mortgage. Check around to see how much others are charging;
- Some lemon law attorneys offer free consultations while others charge, so check ahead of time; and,
- You may be able to offset some of your costs through your auto insurance, tilling up to $1,000 per repair visit.
Assessing the Worth of Legal Representation
Understanding the Value of Legal Representation in a Lemon Law Case
While there are no – absolutely, positively NO – up-front costs to hire a lemon law attorney, many clients still wonder whether or not they can "afford" to hire a lemon law attorney. However, they are really asking whether it is worth it – the time and energy they will have to put into the new process; the additional time a lemon law attorney may take on the case (compared to self-representation); and the cost of litigation over the course of the lawsuit.
Filing a case with the California Lemon Law requires the same standards of proof as any other well-run lawsuit: the plaintiff has to spend significant time and effort getting to know the case law arguments involved, strongly commit to litigation and trial, and keep track of the changing case law. On their own, plaintiffs would have to take notes during depositions, attend settlement conferences (and then prepare for trial when those conferences fail), organize and analyze thousands of pages of documents, and generally try to understand the intricacies of that area of law. It is a highly scientific area of the law, and a lemon law attorney’s job is to understand all of those highly complex arguments and, most importantly, determine how best to prove those arguments to the judge and jury at trial (or what defense arguments the automaker will likely use at trial).
However, automakers have entire teams of attorneys and experts working on litigating these cases, because it is what they have to do. They have to be prepared to defend even against the most basic consumer complaint. Keep in mind: even if the consumer complaint is likely to fail, the automaker still has to fully litigate the matter and pay their own attorneys . Because of this, automaker attorneys will move forward as aggressively as possible on collection of expert fees, and will push those throughout the litigation process. If the consumer loses at trial, the automaker will be sure to request full recovery of expert fees and all the attorneys’ fees – regardless of whether the plaintiff actually won.
The automaker also has a definite incentive to keep litigating the matter, even to the detriment of its own client. That is because the longer the lawsuit goes on, the higher the automaker’s expert fees will go. Expert fees negotiations are highly complicated, and often the automaker’s attorneys will claim that experts have "billed" the automaker by the hour for all of the time the expert has spent on the case. But because plaintiffs have partners and staff attorneys performing most of the tasks involved, they only have to pay for the time a partner puts in at the Rate A rate (which is usually much higher). And automakers know this – they can bill lower commercial rates, and get more fees than the plaintiff will make at trial. If the automaker keeps re-issuing subpoenas and filing sanctions motions even after the plaintiff has complied, the automaker’s attorneys and experts can spend a lot of the litigation gathering billing documents from the experts. So, even though the plaintiff has no obligation to pay any expert fees, the automaker can still rack up the fees in order to work against the plaintiff in terms of fee recovery.
So, can consumers "afford" to hire a lemon law attorney? Yes, absolutely! Because a good lemon law attorney can actually save them money. That is because a lemon law attorney can fight admirably, and can truly help consumers save money – AND time – in the end.