PrepTest 139, Section 2, Question 25

Difficulty5 of 5
Passage 4Restrictions on contingency-fee agreements
The questionFull text in your LawHub copy of PrepTest 139

In October 1999, the Law Reform Commission of(451 more words not shown)

The phrase "gaining disproportionately from(19 more words not shown)

Reading the passage

The commission wants to keep the lawyer's share from eating too far into the client's compensation. But an above-normal fee is not automatically disproportionate. The opening explains why contingency fees generally run higher: the lawyer accepts the risk of doing the work without getting paid.

What we’re looking for

A fair comparison therefore needs to account for both the professional services and that financial risk. We are looking for payment beyond reasonable compensation for those two things.

Working the answers

  • A

    This measures the payment against the services alone. It leaves out the risk of receiving nothing if the case fails. Compensation for that risk can justify a fee above the ordinary value of the legal work.

  • B
    Correct

    This includes both the services rendered and the risk assumed, then identifies the excessive portion beyond reasonable compensation for them. It explains the disproportionate gain the commission wants to prevent.

  • C

    The phrase does not mean whatever the client personally considers unfair. The concern is whether the lawyer's compensation is disproportionate, not whether a client later dislikes the agreed division.

  • D

    Receiving more after success than after failure is the defining feature of a contingency fee: the lawyer is paid only if successful. That difference alone cannot establish that the payment is excessive.

  • E

    Nothing says the judge or jury decides what portion of the damages the lawyer should receive. Awarding damages to the client is different from determining the lawyer's contractual fee.

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