What are lawyer retainers? And how do they work?
What are lawyer retainers? And how do they work?
You might be used to paying for services after they have been rendered, but some legal services are paid for with the use of a retainer. This can be beneficial to both you and your attorney though it may require that you pay more upfront to receive legal services. It's important to understand how this arrangement works beforehand.
Types of Legal Retainers
Some retainer fees are considered non-refundable. However, with these types of retainers, the courts might still require that the retainer be refunded if it is considered to be unreasonable.
Legal retainers are used in all sorts of areas of law including corporate law and commercial law. You may need to hire an estate lawyer or a real estate lawyer. The longer that you will need the services of a lawyer, the more that you may find that a retainer will be useful.
Retainers are Not Necessarily Payments
If you will be paying a retainer fee, this will be an advanced payment made to the other party for services that will then be provided by the party. The retainer isn't meant to be paid but is instead meant to fund the initial operating expenses of the attorney. The money is kept in a separate account so that it is not used for personal reasons. However, a portion of the retainer is ultimately meant to pay your lawyer.
The Typical Cost of a Retainer
The retainer fee might be a few hundred dollars and would be based on how much the lawyer believes that the services will cost. If the services cost more than anticipated, you may be billed for the remainder of the expenses. If the services are less expensive than expected, you may be refunded. An attorney will typically hold a retainer for 30-45 days and then will refund the difference or bill you for any extra work.
Your attorney will typically require a retainer before he or she begins working on your case. Your attorney may choose to not take your case and begin litigation until the retainer fee has been paid.
The retainer fee will be based on the complexity of the case and the amount of work that your attorney will need to do for your case. The cost of the retainer will be based on how experienced and skilled your attorney is. The retainer is for a specific amount of time rather than for a specific project.
Earned Vs. Unearned Retainer Fees
An unearned retainer fee refers to money that is held in an account prior to the services being rendered. The money still technically belongs to you until the work has been completed.
The earned retainer fees are those that are paid to the lawyer after the work has begun. These fees will be distributed to the lawyer near me little-by-little based on the number of hours that the lawyer near me has worked. These fees might be distributed based on milestones.
Refunding the Retainer
When the funds fall belong a specific amount, you may be required to replenish the funds. For example, if you originally paid $4,000, you might be required to replenish the funds if the amount dips below $1,500. However, this agreement can often be negotiated.
If you do not refund the retainer, this doesn't necessarily mean that your attorney will drop your case. They may choose to charge interest on the overdue balance and may take a lien out on your property or documents.
Benefits of a Retainer for the Client
By paying a retainer, you are making sure that the attorney will be focusing primarily on your case. The retainer will allow you to build trust with your attorney because you are showing that you are willing to let your attorney hold the funds throughout the process of litigation.
Officially retaining an attorney will increase the odds that your case will settle. This is because the other party will be concerned when an attorney will be retained due to the reputation and experience of the attorney. The attorney benefits because he or she does not have to worry about losing money by forgoing other opportunities if your case is not successful.
Your Retainer Contract
In the majority of states, you are not required to have your retainer agreement in writing. However, you will usually be better off if you do so. You will want to have specific terms spelled out such as whether the retainer will be refunded to you.
Some lawyers near me may choose to change the terms of the contract if they believe that doing so is necessary to receive your business.
An attorney is legally required to deposit a retainer in a trust and not in a business account. The funds are then transferred from that account to an account that your lawyer has control over. This only occurs after your lawyer provides the services you are paying for.
Calculation of Retainer Fees and the Billing Cycle
You may be forced to pay for additional fees and costs associated with your retainer. These can include filing fees, expert witness fees, postage, and the cost to copy papers. These fees will usually be deducted from your filing fees.
Oversight of Your Attorney's Fund Allocations
However, you will want to check with your attorney about how the funds will be allocated to pay these fees. You will need to be given information on how your fees are calculated. You should also be informed of how often you will be billed. You should receive a billing statement every month.
When the retainer fee has been exhausted, you may be required to pay other fees. For example, you may be required to pay an hourly fee. There may be a contingency fee. Or, you may simply pay a flat fee for all these services.
If you do not agree to how you are being billed, there should be a way in which you can dispute the billing and enter into third-person arbitration. If that is the case, another party will examine your agreement and will decide whether or not the billing is justified and what remedies should be pursued.
You may also suspect that the attorney is not performing the work that you are requesting that the attorney perform. As a client, you are responsible for looking into the work that your attorney is performing and holding the attorney of corporate law accountable.
Your lawyer may request a special retainer. This is used for a specific type of project and the retainer will end once the project is over. However, some states do not allow special retainers because they cannot be discharged until the project is over.
If you are not certain about the retainer that your attorney would like you to pay, it's important to look into the state ethics rules and the state bar to see if the retainer you will be charged is acceptable under the rules.
Regardless of whether you will need a real estate lawyer or an estate lawyer, understanding how a retainer works will help you understand how much you might be billed and what you will need to do to retain the counsel of an experienced cold spring harbor lawyer. The retainer will allow you to know exactly how much you will be billed for the services of your attorney. If you have any questions or concerns you can reach one of the best you can reach the Law Offices of Darren E. Sheehan at (631) 659-3377 or by e-mail darren@DarrenESheehanlaw.com, located in the Huntington/ Cold Spring Harbor area, but representing clients throughout Long Island, Queens, Brooklyn, Bronx, NYC, as well as upstate.