Attorney's fees - How do attorneys determine fees?

Clients using the services of a lawyer often do not know what criteria have been taken into account and therefore it is difficult for them to assess whether this offer corresponds to market realities. So how are attorney fees determined?

Value of the subject of dispute - rates from the Act

As a rule, the attorney's remuneration cannot be set at a lower level than it results from the Regulation of the Minister of Justice on fees for attorneys' services. The amount of these rates, in most types of cases, is dependent on the value of the disputed amount:

§ 2 The minimum rates for the value of the subject matter of the case are:

1) up to PLN 500 - PLN 90;

2) over PLN 500 up to PLN 1,500 - PLN 270;

3) over PLN 1,500 up to PLN 5,000 - PLN 900;

4) over PLN 5,000 up to PLN 10,000 - PLN 1,800;

5) over PLN 10,000 up to PLN 50,000 - PLN 3,600;

6) over PLN 50,000 up to PLN 200,000 - PLN 5,400;

7) over PLN 200,000 up to PLN 2,000,000 - PLN 10,800;

8) over PLN 2,000,000 up to PLN 5,000,000 - PLN 15,000;

9) over PLN 5,000,000 - PLN 25,000.

As the above list shows, the amount of the Client's potential profit has a proportional impact on attorney's costs.

Other factors affecting attorney's fees

Additionally, also using the rules contained in the above-mentioned Regulation (§ 15 section 3 items 1) - 4) and guided by the gained professional experience, the Advocate tries to predict how much work will be involved in the comprehensive handling of the case by him, taking into account in particular:

• the time needed to prepare for the case;

• amount of evidence;

• the degree of complexity of the case;

• number of court appearances.

All these elements, considered together, affect the shape of the offer assigned to a specific case.

Success fee

Taking into account the thematic diversity of cases, as well as the business model adopted by a given Advocate, it is quite common on the market to find Law Firms that offer mixed remuneration models, taking as the basis for the valuation the base amount that is charged to the Client regardless of the outcome of the case and an additional component of remuneration in the form of the so-called success fee, i.e. remuneration that is due only if a result that is favorable, from the client's perspective, is obtained. This remuneration is most often determined as a percentage and depends on the value of the subject of the dispute. It is assumed that the Advocate should not set the success fee at a level exceeding 20-25% of the Client's potential profit, as it may be considered contrary to the applicable rules of ethics, as well as violating generally applicable laws.