Sample Fee/Retainer Agreement

Here is what a fee/retainer agreement looks like. Obviously, the dollar amounts will correspond with what the lawyer you're hiring charges.

1. Purpose

By this agreement I hire Excellent Law Firm to represent me and to be my lawyers in my marriage dissolution proceeding. I understand that Lawyer's Name will be my primary attorney and that she may use other attorneys in the firm to assist her.

2. Fees

(A) Hourly and per-occurrence fees

Legal work done on my file by Lawyer's Name will be billed at $300 per hour. Other lawyers who work on my case will bill at their normal hourly rate. Legal assistants who work on my case will bill at $75 per hour. Law clerks will bill at $75 per hour. Secretarial work will be billed at $20 an hour or will not be billed. Fees will be updated annually, and I will be notified of any rate changes. Billing is done in quarter-hour segments.

I also will be billed for any copying and faxing done for my case.

The hourly fees include the time my attorney and staff spend traveling to and from court, depositions, meeting with experts, etc.

I will be responsible for all filing fees.

I will be billed for all telephone calls generated by my case.

I have ten (10) days to object to items on my monthly bill. If I do not object, I will waive any subsequent objection to the fees on the statement.

This means you need to review your bill as soon as you get it and raise any objections right away. Otherwise, you'll be deemed to have agreed to all charges.

(B) Retainer

The following are four variations of the retainer. Your lawyer may use one or more of these, so read the retainer provisions carefully.

Variation 1: I will pay you a retainer of $5,000 when I sign this contract. You will use these funds as an advance to be applied to the time spent on my case.

When the retainer is exhausted, you will bill me monthly, and I will pay the monthly statement in full within thirty (30) days of receiving it.

If there is money remaining from the retainer when our attorney/client relationship ends, you will refund any balance to me.

This retainer is the least beneficial to the lawyer because once the money is used up, the lawyer has no recourse but to bill for his time.

Variation 2: I will pay you a retainer of $5,000 when I sign this contract. You will use these funds as an advance to be applied to the time spent on my case. Excellent will send me an itemized bill each month. When the retainer balance has been depleted to $1,000, I will be expected to renew the retainer to the starting figure of $5,000.

If I do not renew the retainer in full and on time and my retainer balance falls to $0, Excellent has the right to refuse to provide future legal services on my case and to withdraw as my lawyer. If there is money remaining from the retainer when our attorney/client relationship ends, you will refund any balance to me.

Variation 3: I agree to pay Excellent Law Firm $5,000 in advance, which will be held by the law firm in its trust account to secure my payments.

Excellent will send me an itemized bill each month. I will pay the bill in full each month within thirty (30) days of receipt. If I do not pay in full and on time, Excellent has the right to refuse to provide future legal services on my case and to withdraw as my lawyer.

Should Excellent withdraw, it may pay itself any outstanding amounts I owe for services up to the date of withdrawal. If the $5,000 advance payment exceeds what I owe, Excellent will return any surplus.

The fact that the law firm has $5,000 of your money in its account may encourage you to use your lawyer's time well and to pay your bills. Your lawyer can withdraw if you don't pay, and he may take what you owe from the money in the lawyer's account, so you're not ahead if you don't pay. You lose your lawyer and your money.

Variation 4: In addition to the hourly fees, I will pay a nonrefundable retainer fee of $5,000 that, when paid, immediately becomes a fee that has been earned by my attorney. This is a minimum fee. It is paid in consideration of my attorney reserving and committing time to be available in representing me, thereby precluding my attorney from accepting other clients and employment, including potentially conflicting interests. If more time is spent on this case than this fee would cover at the stated hourly rates, Excellent will bill me monthly, and I will pay in full within thirty (30) days of receipt.

Even if your case settles after your lawyer has put in three hours of time, or $900 worth of her time, she keeps your $5,000. This may not be as bad as it looks. Maybe this lawyer is an expert in an area in which you had issues. Maybe hiring this expert lawyer helped get the case settled faster. Your lawyer still will have to participate in drafting the final documents, so maybe it was a good idea to hire the expert attorney after all.

(C) Premium fee

The final fee may include such an additional fee as justified by the complexity, difficulty, and results of the case.

It's unethical for divorce lawyers to charge a contingency fee, that is, a fee based on a percentage of whatever money is awarded to you. To get around this, some lawyers charge a performance bonus — extra money to them if they get you an outstanding result. If the attorney is going to charge such a fee, it must be included in the retainer agreement.

3. Decisions

I reserve the right to make all important decisions regarding my case. Excellent Law Firm cannot settle the case without my permission.

The law firm is obligated to disclose any settlement offers to you.

4. Communications

Excellent will keep me informed about what is happening in my case and will send me copies of papers it sends out or receives. When I have to make an important decision, Excellent will explain my choices and offer me advice.

I will inform Excellent Law Firm of any change in my address, telephone number, e-mail address, employment, and circumstances. I will not withhold information from my attorneys.

5. Problems

If I am unhappy with the manner in which Excellent Law Firm is handling my case, I will first explain the problem to Excellent. If we cannot resolve our differences, I can terminate this agreement and a) hire another lawyer, b) represent myself, or c) choose not to pursue the case.

In a divorce, you can't stop the case unilaterally unless you're the plaintiff/petitioner — the instigator — and no answer has been filed by your spouse. In reality, you're limited to hiring another lawyer or representing yourself.

If we terminate our relationship for any reason, I owe the fees generated to that point.

6. Responsibility for and Collection of Fees

I am ultimately responsible for my fees. The court may order the other side to pay all or part of my fees, and, if they do so, I will receive credit for same. If they don't pay, I can either pay my attorney to try to collect them, or pay them myself.

You are responsible for paying your lawyer, no matter that the court ordered your spouse to pay.

I grant to my attorney a lien on all property, money, assets, spousal maintenance, or things of value that are recovered, obtained, preserved, or protected for me in the lawsuit. Any amounts I owe shall be payable from them.

If your lawyer places a lien on your homestead real estate (the marital residence), he can't foreclose the lien and force you to sell your house. However, when the house is sold, you must pay the lawyer from the sale proceeds.

7. Capacity

I am of sound mind and body. I am not under the influence of alcohol or mind-altering drugs. I have read this agreement and understand it. I have had any parts that I did not initially understand explained to me.

Make sure you ask for explanations if you need them. Don't worry about looking dumb. You are probably not used to reading documents with language like this, so it is understandable that you may need some clarification.

I approve and accept this contract. I agree to be bound by its terms.

Dated ______________ Client Signature ___________________

If a nonrefundable retainer is used, a second signature like the one following probably will be required.

I understand that the retainer fee paid herein will not be held in a trust account, and I will not receive a refund if I terminate the services of Excellent Law Firm.

Dated ______________ Client Signature ___________________

After you've drawn a huge breath and signed the retainer agreement, you're officially your lawyer's client. Now that you've agreed to pay your lawyer huge sums of money, you need to do everything possible to use his time well.

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