The short answer
Attorney fees pay for a lawyer's work. Case costs are money spent on the matter itself — filing charges, records, transcripts, service, experts — and they are owed regardless of how fees are structured. In a contingency case in particular, ask whether costs come out before or after the fee is calculated, and what you owe if there is no recovery.
01
Two categories, two sets of rules
Fees compensate a lawyer for time, skill, or a result. Costs are out-of-pocket amounts paid to other people so the matter can proceed. They are tracked separately, they behave differently at the end of a case, and an agreement that blurs them will produce a difficult conversation later. Any well-drafted engagement letter treats them in separate sections.
02
What typically counts as a cost
The common categories are court filing charges, service of process, obtaining medical or business records, court reporters and deposition transcripts, expert consultation and testimony, investigators, translation, travel, and sometimes electronic research or delivery charges. Which of these are passed through to a client varies by firm, and the agreement should say.
- Court filing and motion charges
- Service of process and subpoenas
- Records retrieval from providers or agencies
- Court reporters, transcripts, and interpreters
- Expert review, reports, and testimony
- Investigators, travel, and delivery
03
Who fronts the money
In hourly matters, costs are commonly billed to the client as they are incurred. In contingency matters, the firm frequently advances them and seeks reimbursement from any recovery. Both approaches are ordinary. What differs meaningfully is whether interest is charged on advanced costs and whether you remain responsible if the case does not produce a recovery.
04
Why the order of the math matters
In a contingency case, deducting costs before calculating the fee produces a different result than deducting them afterward. The model rule that many states build on requires a contingent fee agreement to state which method applies, precisely because the difference is real. Ask to see the calculation worked through with example numbers so the mechanics are clear before you sign, not after a settlement arrives.
05
Approval thresholds
Expert work in particular can become the largest single cost in a case. A reasonable agreement gives you notice or approval rights above a threshold, so significant spending is a decision rather than a discovery. If your agreement is silent, asking to add a notification threshold is a modest and sensible request.
06
Costs at the end of a case
The final accounting should itemize costs separately from fees, with enough description to identify what each was for. If a recovery is involved, the statement should show the sequence clearly: gross recovery, costs, fee, any amounts owed to others, and the net to you. Ask for that breakdown as a matter of course.
07
A separate idea: court-awarded costs
In some proceedings, a prevailing party can ask the court to shift certain costs to the losing side, and the categories that qualify are defined by rule and are usually narrower than everything a case actually consumed. This is different from the costs in your fee agreement, and one has no bearing on the other — worth knowing so the two are not conflated when someone mentions recovering costs.
FAQ
Frequently asked questions
Do I owe costs if we lose?
That depends entirely on your agreement, and it is one of the most important questions to ask in a contingency matter. Some firms absorb advanced costs when there is no recovery; others seek repayment. The agreement should state which, and if it does not, ask for the answer in writing before signing.
Can I limit how much is spent on costs?
You can ask for a notification or approval threshold above a set amount, and many firms will accommodate it. There is a genuine tradeoff: some spending, particularly on experts, is what makes a case viable, so a limit set too low can undermine the matter it was meant to protect.
Are copying and postage charges normal?
Passing through administrative expenses is common practice, though firms differ on which they charge and how. The reasonable expectation is that these appear as itemized entries you can identify rather than as a lump administrative percentage with no explanation attached.
Lawyer in Town publishes general legal information for consumers. It is not legal advice, it does not create an attorney-client relationship, and it cannot account for the facts of any individual situation. Laws, court procedures, filing deadlines, and outcomes differ by state and by court, and they change over time. Confirm anything that affects a decision with a lawyer licensed in the relevant jurisdiction.
Treatment of advanced costs, cost-shifting between parties, and required disclosures in contingent fee agreements are governed by state rules of professional conduct and by court rules.