RETAINER AGREEMENTS AND RETAINER FEES
WHAT IS A RETAINER AGREEMENT?
A retainer agreement is a contract between client and attorney. The retainer agreement is signed by both the client and the lawyer, and it contains the “rules of engagement” for both parties, as well as clear and specific information regarding payment for the lawyer’s services. You will be asked to sign a retainer agreement before any work can begin in the legal representation of your case.
RETAINER AGREEMENT vs. RETAINER
While the “retainer agreement” is a binding document outlining the responsibilities and commitments of the client and the attorney, the “retainer” is a lump sum that the client agrees to pay to the attorney for the services agreed upon in the retainer agreement. The retainer may be a flat fee that covers a certain amount of work or court appearances and negotiations. Many less complex criminal matters, such as DUI/DWI charges, are often handled on a flat fee basis.
The retainer can also be a larger sum of money which is deposited into an attorney’s trust account. Retainers in trust are often used in family law/domestic relations’ matters (e.g., divorces, modifications, etc.). The attorney then works and bills the trust account as the case progresses. If the retainer amount in trust is depleted before the case is completed, the client may be asked to replenish the trust account before the attorney continues with any more work. If the case is completed and there is a balance left in the trust account, the lawyer will refund the amount in trust to the client.
Occasionally, clients choose to keep an attorney on retainer permanently (keeping the trust account replenished continually) so that they may call on them for legal advice and representation at any time.
WHAT IS IN THE RETAINER AGREEMENT?
A variety of items are addressed and agreed upon in a lawyer’s retainer agreement. Some of the most commonly found items are:
Scope of the agreement: the charges or details of the case to be handled are delineated, and the scope that the lawyer is willing to cover with the retainer amount that is attached to the agreement.
Payment terms: the monetary terms of the contract are outlined in detail for the benefit of both parties, including the hourly wage of the lawyer, or the flat fee required, and the amount of retainer in trust required to begin work on the case. In the case of a contingency fee agreement (payment only in the event the case is settled or won), the contingency amounts and any other costs are also stated, even though no amount is due to begin the work.
Services not covered: it is common for retainer agreements and retainer fees to only cover items within the immediate future of the case. For example, in a DUI case it may cover initial appearances, pretrial hearings, and negotiations out of court with a prosecutor. It is common for retainers to NOT cover the price of trials and appeals. These services typically need a new agreement that will cover the engagement in detail.
Firm responsibilities: the lawyer and firm commit to do all within their professional abilities and power to fairly and aggressively represent the client.
Client responsibilities: the client agrees to assist the firm in the representation of the case by being cooperative, appearing with the attorney at hearings, providing all necessary information, and remaining in contact with the firm.
Other common items: retainer agreements clearly state other costs and expenses not covered by the retainer fee, disclaimers on liability and guarantees, and collections procedure, among other subjects.