In a typical contingency fee arrangement, the successful attorney receives a percentage of “all sums recovered” by his or her client in a dispute or litigation. Oftentimes, this calculation is straightforward—the plaintiff recovers $X via settlement or verdict and the attorney takes a percentage of that recovery. But what about case-related victories that do not result in a direct recovery for the plaintiff, such as securing the dismissal of a counterclaim or obtaining declaratory or injunctive relief?
In each instance, the attorney may have spent significant time obtaining that non-monetary victory. If the retainer agreement limits the contingency fee to a percentage of “all sums recovered,” however, New York courts have held there is no fee recovery for non-monetary victories, leaving the attorney holding the bag for his or her hard-fought success.