The attorney's fee: compensation for the work
The contingency fee is the attorney's own compensation for handling the case — calculated as a percentage of the settlement or award. It's earnings, not a reimbursement, and it's what the attorney keeps for taking on the risk and the work of the case.
Case costs: real expenses the case required
Case costs are something entirely different: actual out-of-pocket expenses the case genuinely needed. This typically includes expert witness fees, court filing fees, the cost of obtaining medical records, deposition transcripts, and similar litigation expenses. These are reimbursed, not earned — the attorney's office is simply being paid back for money it spent on the client's behalf.
A genuinely important detail: the order matters
Here's something easy to overlook. Calculating the attorney's fee as a percentage of the full settlement before subtracting case costs produces a different net result than calculating the fee after costs have already been subtracted. On a meaningful settlement with real litigation costs, that difference in methodology can add up to a real dollar amount — worth confirming explicitly in the written fee agreement rather than assuming either approach.
Who fronts the money while the case is pending
Commonly, the attorney's office advances case costs as the litigation proceeds, with reimbursement coming out of the eventual settlement or award. The specific terms of this arrangement, including what happens to those advanced costs if the case doesn't result in any recovery at all, depend entirely on the individual fee agreement — another reason to read it carefully before signing.
Why keeping these separate genuinely helps
Treating the fee and the costs as two distinct line items, rather than one combined deduction, makes it much easier to understand exactly where your settlement dollars are actually going — and to ask informed questions if either figure looks unexpectedly high.