Ask Me Help Desk - Contingency fee

Contingency fee

I defaulted on my attorney fee's and was put through a wage garnishment by a third party attorney's office. They garnished approximately 80% of the balance before I changed jobs, I thought the bad debt was taken care of, when I found out it was not I paid the remaining 20% in August. They have now come back charging me a per diem and a contingency fee for 25% of the awarded judgement that was never calculated to be charged to me, I understand the per diem charge by why after all this time are the collecting the contingency fee from me, isn't that due by to debtee as their portion of what they collected from me?

Contingency for what? You can demand an accounting from them

I have the accounting, they are charging me a 25% contingency fee for collecting my debt

Do you have a copy of the judgement? EXACTLY how is it worded? If it states in the wording something about "fees to collect the debt" or something of that nature they can keep charging you until the TOTAL balance and all fees for collection, etc are paid. If you believe they're overcharging for all of the collection fees it would be up to you to go back to the court and fight it.

This is not uncommon, and it can keep going on forever - as long a you owe them 1 cent they can keep billing for more fees. It can be a never ending cycle in on-going payment situations

A contingency fee for a legal action, generally means that if you win the case you otherwise you don't. So I don't really understand what this fee is contengent on. That's what you need to ask.

I can get a copy of the order. I have the original request from them also of exactly what fees they were asking for, they never asked for a contingency fee initially. Now they are coming back for this per diem because they just now figured out that the account is paid and they tacted on another $223.75 contingency fee, that wasn't due previously.

I imagine that a contingent fee would be payable by the debtor for the collector collecting on the account, not by me for collecting on my account.

That would make sense to me.

Quote:

Originally Posted by Justwantfair

I imagine that a contingent fee would be payable by the debtor for the collector collecting on the account, not by me for collecting on my account.

Yes, except that the judgement most likely says that you're responsible for all of their legal fees...

Ok, wait - I think I may have read "into" your question.

Do they have an actual judgement against you? Or are they just "collecting" on their bill?

They are collecting my bill for my attorney and they are charging me to pay the contingency fee.

Ok, sorry, I got a little ahead of myself there.

Did you have a contract with them? And if so, does it state what they can do in the way of collecting on their bill and collection fees?

I know if they GOT a judgement against you they would be able to collect on their legal fees.

I do not have any agreements with them, they are the collection agency for the attorney I had a fee agreement with. I am going to have to go down to the courthouse to get a copy of the judgement against me, I know that it was for my portion of the attorney fees (40%) plus costs, I just don't think the attorney's contingency fee could be my cost. It should be her cost for having the debt collected. I don't know how they can work it in for that to be paid by the person who owed. Even if it was ordered I don't understand why it wasn't on the original breakdown of the fees that they could garnish from my wages. They are bringing it up now that the account is paid.

Again, I think you need to get an explanation of this fee. Right now all you know is they are callling it a contingency fee. But you don't know what it was contingent on.

Quote:

Originally Posted by Justwantfair

I do not have any agreements with them, they are the collection agency for the attorney I had a fee agreement with.

Ok, that's what I meant... did you have a contract with the original attorney who you owed the bill to? If so, see what it says about them collecting from you. That contract may allow them to pass along any "collection fees" they incur.

Quote:

Originally Posted by Justwantfair

I am going to have to go down to the courthouse to get a copy of the judgement against me, I know that it was for my portion of the attorney fees (40%) plus costs, I just don't think the attorney's contingency fee could be my cost.

So they DO have a judgement against you?? Well, then the wording of that judgement will state what they can collect. It's not unusual that the judgement allows them to pass their legal / collection fees on to you.

Quote:

Originally Posted by Justwantfair

Even if it was ordered I don't understand why it wasn't on the original breakdown of the fees that they could garnish from my wages. They are bringing it up now that the account is paid.

And I agree with you... this is where it gets "iffy". That's where I was saying earlier, it just gets this vicious cycle going.

Let us know what the judgement says.

I just came back from the courthouse and our file is out because we are in court on Monday, I won't know anything until then. I have already written to both Attorneys in the matter, to request what if any obligation I have to the continegency fee.