Advice about Legal Retainer Fees
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Meaning of lawyer's ''retainer''
Dec 2002What is meant by a retainer? I anticipated legal trouble and consulted a lawyer. At his request, I paid him a $1,500 ''retainer '' up front. However, the legal problems never materialized. (Despite having mistreated others, my potential adversary dealt honorably with me.) Thus, my lawyer spent at most 2 hours hearing my concerns over the phone and reading a couple of e-mails. Is it incumbent upon my lawyer to refund me part of the $1,500, because, at his usual hourly rate, he could not possibly have earned $1,500? Or is a retainer a sort of fixed cost that one owes a lawyer for agreeing to take on a case, regardless of whether or not substantial services were rendered? anon
Check the paperwork that you signed when you retained the lawyer. Many lawyers will refund the balance of a retainer that was not earned. You can contact the State Bar of California Complaints Against Attorneys 1-800-843-9053 for advice about getting your money back and/or registering a complaint if necessary. I've pasted the language in the Code of Professional Conduct, which governs attorney conduct. Good luck.
A member whose employment has terminated shall:
(1) Subject to any protective order or non-disclosure agreement, promptly release to the client, at the request of the client, all the client papers and property. ''Client papers and property'' includes correspondence, pleadings, deposition transcripts, exhibits, physical evidence, expert's reports, and other items reasonably necessary to the client's representation, whether the client has paid for them or not; and
(2) Promptly refund any part of a fee paid in advance that has not been earned. This provision is not applicable to a true retainer fee which is paid solely for the purpose of ensuring the availability of the member for the matter.
Discussion: Paragraph (D) also requires that the member ''promptly'' return unearned fees paid in advance. If a client disputes the amount to be returned, the member shall comply with rule 4-100(A)(2). anon
A retainer is basically a deposit for services rendered. However, the attorney would still bill you for all services. I recently ended my relationshiop with an attorney and simply sent a letter terminating service and asked for the retainer to be returned which it was. anon
I am not a lawyer, but have used lawyers requiring retainers in the past. I believe they are required to account for them separately, and that amount was not just a flat fee for his services. Rather, the lawyer should present you with a bill for actual services rendered and the bill should be applied against the retainer with you receving a refund for the difference. You should write a letter requesting an itemized bill and the refund of your remaining retainer if you no longer intend to use his services. He has no incentive to give you your money back unless you ask for it! Claire
The lawyer should refund that portion of the retainer that was not used, and should provide you with a bill for services rendered, so you can see just what was done for you and how long it took. A retainer is just an advance payment, not a freebie. Wendy Woolpert
The term ''retainer'' can refer either to a flat fee (that is, $1,500 for the job, no matter how much or little time it takes) or a ''refundable retainer'' -- a sort of deposit that the lawyer holds, deducting his hourly fees and expenses as he goes along, and returning the unused balance at the end of the case. You should have a written agreement with your lawyer that specifies which sort of retainer it is (lawyers are required to have written agreements of that sort with their clients).
That said, the most common retainer arrangement in the situation you described is a ''flat fee'' -- you paid the lawyer $1,500 to take care of the problem. That represents a sort of gamble for both you and him. If he had put in a lot of time on it, you would not have taken kindly to him asking for more money -- you had already paid his fee. On the other hand (which is where you seem to be), he may not feel any obligation to refund some of his fee just because your problem went away so easily. The theory is that, if he gets a little windfall in some cases, it makes up for the bath he has to take in others ....
Even so, some lawyers would feel queasy about keeping that much money for so little work. You might just want to have a relaxed, friendly conversation with him about it, and see what happens. Good luck. may
A retainer can mean almost anything, but if it wasn't agreed upon, your lawyer should return anything you paid over and above the two hours s/he worked. anon
The money you provided to the attorney must remain in a trust account until it is ''spent'' on hours worked. He must send you a bill detailing his time and if there is no further work to be done he should give you back any remaining money. The trust account is basically money being held in your name and it belongs to you until the lawyer does work to earn it. After accruing hours, and informing you via an itemized bill, he can transfer the appropriate amount of money to his business account. Debbie
Most often, the unused portion of your retainer would be refunded to you by the lawyer without question, within about 30 days after you notified him you did not plan to proceed. (Standard procedure in my firm and, so far as I know, anywhere else.) However, check your fee agreement. (If you didn't sign one, your lawyer is guilty of an ethical violation regardless of what happens with the money.) It's possible that the lawyer claims that retainer as a sort of minimum fee. However, I find it hard to imagine any lawyer insisting upon this when challenged, so it's worth pursuing a refund (less a reasonable charge for the time he actually spent on you plus any expenses for things like photocopying your file). Holly
The term ''retainer'' has different meanings to different people.
Most people use the term ''retainer'' to mean prepayment of attorney fees. When the services are over, the attorney then owes the client the ''unearned'' fees.
A ''true retainer'' is money paid to reserve the attorney's services in the future. No service is rendered for the money. It's like a signing bonus. California tends to construe the term strictly against the attorney. Any indication from the attorney that the ''retainer,'' or any part of it, was used for fees, renders it a prepayment of attorney fees.
If there is no written contract, and the amount is over $1,000, then any alleged agreement can be declared void by the client. At that point, the attorney is entitled to reasonable value of actual services rendered.
The client should ask the attorney for an accounting and request a refund of the unearned fees. If there is any problem, the request should be put in writing. Juliette
I am an attorney and I take this issue pretty seriously. Your answer lies in the attorney-client contract which you signed when you retained the attorney. It is also called a Retainer Agreement. If you did not sign one, that is a violation of the Rules of Professional Responsibility which are governed by the State Bar. Any agreement for services exceeding $1,000 must be in writing.
Normally, most retainers are refundable. The lawyer is to take from the retainer non-disputed hourly charges and out of pocket costs (photocopies, parking, filing fees, and even his own secretary - which bothers me to no end but it should be disclosed in the agreement. And if you signed it, you are assumed to have read it.) So, you give me $1,500 and I do two hours of work at $200 per hour, my paralegal ''opens'' your file, some copies and postage. $457. You are owed 1500 minus 457. If you ask for a bill, the State Bar requires that your lawyer produce one within 10 days of your request.
Check your agreement to see if there was a nonrefundable clause. As draconian as it may sound, sometimes we pass up major cases because we already have too much on the plate or have a conflict on the date of YOUR hearing. You resolve things, we are out you and the other guy. So, that is the reasoning.
You need to 1) put in writing your concerns to your attorney 2) if his/her answer is not acceptable, contact your local Bar Association (Alameda County Bar Association fr example) and request the Fee Arbitration Panel. You will be assigned volunteer attorneys to mediate the dispute and review the records and the lawyers will make the call. It keeps us legitimate.
Good luck. Please know that we are not all snakes. H.E.S.
When you pay a lawyer a retainer, it is generally considered to be an advance payment for the time your attorney actually expends on your matter (assuming the lawyer is intending to be paid on an hourly basis, rather than on contingency). Thus, if the lawyer only worked on your matter a couple hours, he or she should deduct her usual hourly rate from retainer, and return the balance to you. If you paid a retainer, you definitely should have been asked to sign an engagement agreement (also called a retainer agreement, or other similar term). That agreement should state the terms of your contract with the lawyer, including what your respective obligations are with respect to the retainer. I suppose some attorneys might put in their retainer agreement that the retainer is non-refundable, although I would think that would be unusual and possibly unethical, depending on the circumstances. If the lawyer did not have you sign a retainer agreement, I would say he/she breached her ethical obligations (although how big of a breach would be a matter of debate). While attorneys certainly occasionally do brief projects for clients without the formality of a retainer agreement, if a retainer is asked for and paid, there should certainly be a retainer agreement. (P.S. I am an attorney, but I do not work on a hourly basis (contingency only), and therefore my office does not collect retainer fees. I offer my comments based on my recollection as to the rules of professional conduct and generally accepted practice.) Kim