The contingency-fee system, which allows lawyers and their clients to agree that the lawyer will be paid only in the...

GMAT Critical Reasoning : (CR) Questions

Source: Official Guide

Critical Reasoning

Misc.

HARD

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Notes

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The contingency-fee system, which allows lawyers and their clients to agree that the lawyer will be paid only in the event of success, does not increase the number of medical malpractice lawsuits brought against doctors. As attorneys must cover the costs for their time and research, they want to be assured that any medical malpractice case they accept on a contingency-fee basis has substantial merit. Consequently, attorneys turn away many people who come to see them, for lack of a good case.

The argument above is most vulnerable to criticism on the grounds that it fails to

specify the criteria attorneys use to judge the merits of a medical malpractice case

consider whether, in the absence of a contingency-fee option, even people with meritorious cases are much less likely to initiate litigation if they believe they might incur large legal fees

note whether, in successful medical malpractice lawsuits, the average monetary award after legal costs have been deducted is less under contingency-fee arrangements than otherwise

consider the effect of the contingency-fee system on the number of lawsuits sought for reasons other than medical malpractice

acknowledge the rising cost of medical malpractice insurance

Solution

Passage Analysis:

Text from Passage	Analysis
The contingency-fee system, which allows lawyers and their clients to agree that the lawyer will be paid only in the event of success, does not increase the number of medical malpractice lawsuits brought against doctors.	What it says: Contingency fees don't cause more malpractice lawsuits to be filed What it does: Makes the main claim that this payment system doesn't lead to more lawsuits What it is: Author's main conclusion
As attorneys must cover the costs for their time and research, they want to be assured that any medical malpractice case they accept on a contingency-fee basis has substantial merit.	What it says: Lawyers need strong cases since they pay upfront costs and only get paid if they win What it does: Provides the reasoning behind why contingency fees wouldn't increase lawsuits What it is: Author's premise Visualization: Lawyer's perspective: Upfront costs = $\$5,000-10,000$ (time + research) → Payment = $\$0$ if lose, $\$30,000+$ if win → Need $80\%+$ chance of winning to take case
Consequently, attorneys turn away many people who come to see them, for lack of a good case.	What it says: Lawyers reject lots of potential clients because their cases aren't strong enough What it does: Shows the result of lawyers being selective, supporting the main conclusion What it is: Author's supporting premise Visualization: $100 \text{ people approach lawyer} \rightarrow \text{Only } 20-30 \text{ have strong cases} \rightarrow 70-80 \text{ people get turned away}$

Argument Flow:

The argument starts with the main conclusion that contingency fees don't increase malpractice lawsuits. Then it explains why this is true by showing that lawyers have financial incentives to be very selective about cases they take, which leads them to reject many potential clients.

Main Conclusion:

The contingency-fee system does not increase the number of medical malpractice lawsuits brought against doctors.

Logical Structure:

The argument uses a cause-and-effect chain: lawyers pay upfront costs under contingency fees → they need strong cases to ensure payment → they become very selective → they turn away many clients → therefore, contingency fees don't increase the total number of lawsuits filed.

Prethinking:

Question type:

Misc - This is a flaw question asking what the argument 'fails to' consider, so we need to identify logical gaps or oversights in the reasoning

Precision of Claims

The argument makes a definitive claim that contingency fees 'do not increase' malpractice lawsuits, based on the quality-based reasoning that lawyers are selective

Strategy

Look for what the argument overlooks or fails to consider. The argument focuses only on lawyers being selective due to upfront costs, but ignores other factors that could still lead to more lawsuits overall. We need to find gaps in the reasoning - things the argument should have addressed but didn't

Answer Choices Explained

specify the criteria attorneys use to judge the merits of a medical malpractice case

This choice suggests the argument should specify criteria attorneys use to judge case merits. However, this isn't a flaw - the argument doesn't need to detail specific criteria to make its point. We can understand that lawyers evaluate case strength without knowing whether they focus on medical records, expert opinions, or damage amounts. The argument's logic about selectivity works regardless of the specific criteria used.

consider whether, in the absence of a contingency-fee option, even people with meritorious cases are much less likely to initiate litigation if they believe they might incur large legal fees

This identifies a critical gap in the argument's reasoning. The argument only considers how contingency fees affect lawyer behavior (making them selective) but completely ignores how payment systems affect client behavior. Without contingency fees, people with strong cases might not sue because they can't afford $10,000+ in upfront legal costs or risk losing and paying even more. So while contingency fees make lawyers pickier, they also enable access to justice for people who couldn't otherwise afford to sue. The argument fails to consider this crucial counterbalancing factor.

note whether, in successful medical malpractice lawsuits, the average monetary award after legal costs have been deducted is less under contingency-fee arrangements than otherwise

This choice focuses on monetary awards and legal costs, but this isn't relevant to the argument's flaw. The argument is about whether contingency fees increase the number of lawsuits, not about how much money people receive. Whether winners get more or less money after legal fees doesn't affect the core logic about lawsuit volume.

consider the effect of the contingency-fee system on the number of lawsuits sought for reasons other than medical malpractice

This choice mentions other types of lawsuits beyond medical malpractice. However, the argument specifically limits its scope to medical malpractice lawsuits, so we don't need to consider personal injury, contract disputes, or other legal areas. The argument isn't flawed for focusing on its stated domain.

acknowledge the rising cost of medical malpractice insurance

This choice brings up medical malpractice insurance costs. While insurance costs are related to the broader issue, they're not directly relevant to the argument's logic about whether contingency fees increase lawsuit numbers. The argument's reasoning about lawyer selectivity stands or falls independently of insurance cost trends.

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