What does contingency mean in law?

A contingency fee agreement means that an attorney receives payment only if a claim is decided in favor of the client. A lawyer represents his client for the duration of a case. The lawyer bears the costs of hiring experts, as needed, without charging an initial fee or the usual hourly rate. A contingency fee is a payment to an attorney for legal representation and services that depends on the recovery of monetary damages.

It's the popular “Don't Win, Don't Pay” model. When compensation is awarded for a case, the law firm charges a percentage as payment. If the case is lost, the customer does not pay a fee. First, a contingency fee agreement will sometimes result in a lawyer receiving more money than if he paid the lawyer by the hour.

With a mixed-time contingent setup, your lawyer will likely also receive a percentage of the recovery in addition to the lawyer's hourly rate. However, if your lawyer takes the contingency fee percentage before or after these costs are paid, it can make a significant difference in the amount you and your lawyer ultimately receive.