Settlement Calculator — Fee Methods and Expense Arrangements Explained
Understand the 6 calculation paths supported by LeanLaw’s Settlement Calculator: 3 expense arrangements × 2 fee methods.
Fee Methods
LeanLaw supports two fee calculation methods, configured at the matter level:
| Method | How It Works | Example (33.33% fee, $100K recovery, $10K expenses) |
|---|---|---|
| Gross | Fee is calculated on the full recovery amount | Fee = $100K × 33.33% = $33,330 |
| Net-of-Expenses | Expenses are subtracted from recovery first, then fee is applied | Fee = ($100K - $10K) × 33.33% = $29,997 |
Expense Arrangements
LeanLaw supports three expense arrangements:
| Arrangement | Description | How It Affects the Statement |
|---|---|---|
| Firm Advances All Expenses | Firm pays costs upfront; all expenses deducted from client’s share at settlement | All unbilled expenses appear under “Expenses Advanced” |
| Client Pays As They Go | Client reimburses costs during the case; only unreimbursed balance deducted at settlement | Step 5 (Map Payments) is required; only unreimbursed expenses are deducted |
| Firm Absorbs Expenses (from Fee) | Expenses deducted from the attorney’s gross fee; client pays no expenses | Expenses reduce the attorney’s fee, not the client’s share |
The 6 Calculation Paths
Every matter uses one of these 6 combinations:
- Gross + Firm Advances
- Gross + Client Pays As They Go
- Gross + Firm Absorbs
- Net-of-Expenses + Firm Advances
- Net-of-Expenses + Client Pays As They Go
- Net-of-Expenses + Firm Absorbs
The wizard handles all 6 automatically based on your matter settings.
Rounding
- All amounts are rounded to the nearest penny by default
- Optional: The attorney fee amount can be rounded to the nearest dollar (amounts ≤ $X.50 round down, > $X.50 round up)
- Expenses, liens, and net proceeds are always penny-precise