Posted on June 9, 2009 by John Steele
I have been meaning to post some thoughts about legal retainers. Basically, for those of you who have not had the pleasure of retaining an attorney, there are two things you need to do: 1. sign a retainer agreement and 2. pay a retainer. (Side note: Do not ever use an attorney unprofessional enough to not use a retainer agreement). The retainer is a sum of money paid by a new client to their new attorney to be held in trust by that attorney until such time as that attorney performs work and thus earns some of that retainer.
So why use retainers? Well, attorneys need to get paid for their services. And not all potential clients are forthright about their ability to pay. And once an attorney begins work on a case, its frustrating to work for a month or two, find out your not going to get paid, and withdraw. So attorneys want to make sure their new clients have some sort of money to pay them with.
The real issue of this post is what is the right amount for a retainer and does retainer amounts have to do with the quality of legal services, or whether a lawyer is good. Unfortunately, not much. Obviously good and bad attorneys can charge little or a lot. What is really silly is trying to compare attorneys by the amount of retainers charged. Why? The amount of retainer has nothing to do with the amount of money that attorney will charge you for the entire case. For example, attorney A charges a $1500 retainer and attorney B charges $4000. A’s final bill is $5000, B’s final bill is $4500. B was the cheaper attorney.
Relatedly, you cannot tell anything about an attorney from their retainer. In our previous example, A could be a better attorney who, with his wisdom, could tell the legal matter was a small one he could solve easily, and should only be $1500, whereas attorney B just wanted as much money up front as possible. Or maybe B knew it was a $1500 type of case, but was hoping to drive up the bill. I am not saying there are a lot of unethical attorneys out there, but there are some. More important to this post is do not get blinded by the retainer, listen to your gut as to how the attorney would handle your case. A good attorney will tell you exactly what he plans on doing (in non legalese). A good attorney will answer all your questions, explain how they bill, explain the amount of retainer, and be more than happy to detail their billing system, including their hourly rate.
Lastly, a good attorney will not be afraid to discuss your case with you at no cost in my opinion. I would never charge for a consultation. If a potential client has money to hire a lawyer, comes to see me, and ends up not hiring me, it just was not a good fit. Such a scenario happens infrequently enough that I am comfortable with taking the time to meet potential clients this way. In the end, good service is the key to a smooth and complaint free practice. Posted on June 9, 2009 by John Steele
I have been meaning to post some thoughts about legal retainers. Basically, for those of you who have not had the pleasure of retaining an attorney, there are two things you need to do: 1. sign a retainer agreement and 2. pay a retainer. (Side note: Do not ever use an attorney unprofessional enough to not use a retainer agreement). The retainer is a sum of money paid by a new client to their new attorney to be held in trust by that attorney until such time as that attorney performs work and thus earns some of that retainer.
So why use retainers? Well, attorneys need to get paid for their services. And not all potential clients are forthright about their ability to pay. And once an attorney begins work on a case, its frustrating to work for a month or two, find out your not going to get paid, and withdraw. So attorneys want to make sure their new clients have some sort of money to pay them with.
The real issue of this post is what is the right amount for a retainer and does retainer amounts have to do with the quality of legal services, or whether a lawyer is good. Unfortunately, not much. Obviously good and bad attorneys can charge little or a lot. What is really silly is trying to compare attorneys by the amount of retainers charged. Why? The amount of retainer has nothing to do with the amount of money that attorney will charge you for the entire case. For example, attorney A charges a $1500 retainer and attorney B charges $4000. A’s final bill is $5000, B’s final bill is $4500. B was the cheaper attorney.
Relatedly, you cannot tell anything about an attorney from their retainer. In our previous example, A could be a better attorney who, with his wisdom, could tell the legal matter was a small one he could solve easily, and should only be $1500, whereas attorney B just wanted as much money up front as possible. Or maybe B knew it was a $1500 type of case, but was hoping to drive up the bill. I am not saying there are a lot of unethical attorneys out there, but there are some. More important to this post is do not get blinded by the retainer, listen to your gut as to how the attorney would handle your case. A good attorney will tell you exactly what he plans on doing (in non legalese). A good attorney will answer all your questions, explain how they bill, explain the amount of retainer, and be more than happy to detail their billing system, including their hourly rate.
Lastly, a good attorney will not be afraid to discuss your case with you at no cost in my opinion. I would never charge for a consultation. If a potential client has money to hire a lawyer, comes to see me, and ends up not hiring me, it just was not a good fit. Such a scenario happens infrequently enough that I am comfortable with taking the time to meet potential clients this way. In the end, good service is the key to a smooth and complaint free practice.
]]>
Recent Comments