ABSTRACT
This chapter evaluates the principal arguments advanced in favor of contingent fee contracts and proposes an alternative arrangement that involves the "sale" of lawsuits from plaintiffs to lawyers. Having established the efficiency of a sharing arrangement with regard to lawyer/farmer effort, it next considers how it would fare with regard to risk-sharing, or the allocation of uncertainty associated with the random factors affecting output. In the lawyer-client context, these factors seem to work in the direction of allowing plaintiffs to sell their lawsuits. The chapter further focuses on conflicts that might arise regarding the plaintiff's filing decision, and the decision of whether to settle the case or take it to trial. In the absence of any conflict of interest, these decisions should be made based on a comparison of the full expected value of the case to the cost of filing suit, and to the defendant's settlement offer, respectively.
