Risk-free Litigation – Achieve justice with a success-based fee

Under the traditional rules of the German Lawyers’ Compensation Act (RVG), a lawyer’s fee is based on the scope and nature of their work, regardless of the case outcome. However, with the reform that came into effect on October 1, 2021, § 4a RVG was revised to legally allow success-based fee agreements.

A success-based fee means that the lawyer’s payment depends entirely or partially on achieving a specific legal outcome. Depending on the case, this success can take different forms, such as winning a case in full or in part, negotiating a settlement, successfully enforcing a claim, or registering a right.

If the goal is achieved, the lawyer receives a previously agreed-upon fee, often calculated as a percentage of the recovered amount or as a surcharge on the statutory fee. If the goal is not achieved, the fee is significantly reduced or waived entirely. In this case, the client bears only minimal cost risk.

Not every legal dispute qualifies for a success-based fee arrangement. The law permits this form of compensation only under certain conditions. A key requirement is that, without such an arrangement, the client would not be able, or only with considerable risk,nto pursue their rights, either economically or personally.

Typical case scenarios where success-based fees are especially suitable include:

• Corporate Law: For example, when a shareholder wants to claim compensation after being excluded from a GmbH, or when a company seeks damages from former directors or executives. Such cases are often complex and involve high amounts in dispute, ideal for a success-based fee.
• Commercial Law: This often involves contractual or tort-based claims between business partners, such as disputes over delivery contracts, violations of general terms and conditions, or non-payment. A success-based fee enables even smaller companies to enforce legitimate claims without financial risk.
• Employment Law: Whether it’s a wrongful termination lawsuit, severance negotiations, or disputes over salary claims, success-based fees can offer an attractive solution for obtaining qualified legal representation without risking one’s financial stability.
• Tenancy Law: Particularly common in cases involving refund claims (e.g., security deposits, service charges) or rent reductions. These often involve relatively small amounts, which clients might not pursue without a success-based fee.

In all these areas, success-based fees provide a way to access legal support, even when financial or psychological barriers exist.

Success-based fees offer several clear advantages:

• Reduced cost risk for clients: Clients generally only pay if the case is successful. This significantly lowers the threshold for taking legal action.
• Strong incentive for the lawyer: The lawyer earns only if they succeed. This aligns the financial interests of the lawyer and client, they are “in it together.” The lawyer has a vested interest in pursuing the case with full commitment to achieve the best possible outcome.
• Transparent and predictable fees: The terms of payment are clearly and transparently outlined in writing at the beginning of the engagement. No unpleasant surprises or hidden costs.
• A clear signal to the opposing side: If a lawyer takes on a case on a success-fee basis, it signals to the other side that the chances of success are considered high. This increases pressure to reach a settlement early.
• Access to justice for everyone: For individuals who cannot or do not want to bear the cost of conventional litigation, a success-based fee opens a fair and just path to the courts. It also creates real added value for high-stakes cases where statutory legal fees and court costs can be enormous, by minimizing the economic risk involved.

We will work with you to assess whether your specific case is suitable for a success-based fee agreement. In doing so, we consider your individual financial situation, your legal goals, and the chances of success.

If your case qualifies for a success-based fee, this means:

• Maximum relief from legal costs
• Top-tier legal representation by experienced attorneys
• Fair and transparent fees, only in the event of success

ECOVIS Heidelberg is your experienced partner, offering comprehensive services for all your legal matters – reliable, efficient, and sustainable.