Drafting a carefully prepared retainer agreement is one of the most important things you can do to preserve positive relations with your client. A well-written retainer agreement can protect both you and your client from disagreements and misunderstandings down the road. In addition, it is important to check your state’s ethical rules in drafting a retainer agreement to avoid possible state bar complaints.
There is no standard attorney retainer agreement, but there are certain features that are common to most:
- Retainers should always be in writing. Many jurisdictions prohibit oral agreements.
- Specify the amount of the initial retainer, and whether it is refundable or not. Discuss the terms of subsequent billing and frequency.
- Specify the client’s right to terminate your services, and detail what your obligations are after termination (e.g., offering to copy the file at the client’s expense for incoming counsel).
- State whether a conflicts of interest search has been undertaken, and whether there are any conflicts, and if so, whether they have been waived.
- Define the scope of the arrangement (e.g., whether you will be litigating the trial and the appeal). This is particularly important if you have specified that you are to be paid a flat fee.
- Identify who will work on the case, what they will do, and what rate they are to be paid.
- Estimate all fees necessary to undertake the agreement, not just the depletion of the retainer amount.
- Specify the goals of the engagement (e.g., a winning summary judgment motion), but make clear that there are no guaranteed results.
- Specify whether mediation or arbitration will be used to resolve attorney/client disputes relating to the retainer agreement.
- Identify preferred methods of communication, whether it is by phone, e-mail, mail or text message.
- Discuss additional costs that may be charged, including costs for copies, court costs, travel expenses, long-distance phone charges, etc.
- Make clear what is to happen if the client doesn’t pay. Recourse for nonpayment may be a service fee on the overdue balance or imposition of a lien on documents and property in possession of the attorney.
- Obtain electronic and wet signatures. Electronic signatures are becoming increasingly universal, and have been affirmed in several court cases and various pieces of legislation as legally binding. However, obtain a wet signature copy for your file just in case of any discrepancy.
Having a solid retainer agreement in place is the best way to ensure that you and your client understand your respective responsibilities and prevent disagreements. For more information on how to ensure that your agreement does not pose any ethical violations, see the American Bar Association’s guide to drafting retainer agreements here.