1.69 - B. Contingent Fee Schedule

• Jurisdiction: New York

b. Contingent Fee Schedule

The schedule of reasonable fees for contingent fees in personal injury or wrongful death other than healthcare malpractice is either one-third of the “sum recovered” or a sliding scale of 50% of the first $1,000 of the “sum recovered,” 40% on the next $2,000 of the “sum recovered,” 35% on the next $22,000 of the “sum recovered,” and 25% on any amount over $25,000 of the “sum recovered.” Percentages above these schedules are per se excessive and unreasonable.

The “sum recovered” to which these schedules of percentages are applied is computed by one of the following two methods, to be selected by the client in the retainer agreement or letter of engagement:

1. On the net sum recovered after deducting from the amount recovered expenses and disbursements for expert testimony and investigative or other services properly chargeable to the enforcement of the claim or prosecution of the action; or

2. In the event that the attorney agrees to pay costs and expenses of the action pursuant to Jud. Law § 488(2)(d), on the gross sum recovered before deducting expenses and disbursements. The retainer agreement or letter of engagement shall describe these alternative methods, explain the financial consequences of each, and clearly indicated the client’s selection. In computing the fee, the costs as taxed, including interest upon a judgment, shall be deemed part of the amount recovered. ³⁴³

Where the retainer agreement between L and C provided that L would receive a specified percentage of any net recovery obtained, the net proceeds did not include the value of an unfunded scholarship established by defendant in memory of C’s decedent. In C’s action against defendants City and University for the wrongful death of C’s son, C, who was himself an attorney, excluded L from settlement negotiations with defendants and settled the action for $100,000 from the City and a scholarship to be established by the University in memory of C’s son. L was entitled to his percentage of only the $100,000 cash that C received. The scholarship was not an asset of the estate and had no monetary value to C.³⁴⁴

Judiciary Law § 474-a controls the percentages for contingent fees in medical, dental and podiatric malpractice cases. Section 474-a states that “[n]otwithstanding any inconsistent judicial rule” to the contrary, a contingent fee in any healthcare malpractice case must not exceed the following schedule:

30% of the first $250,000 of the “sum recovered”

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