Most attorneys (and many other professional service providers), when contracting at an hourly rate, will require an up-front payment known as a retainer. The retainer is placed in the attorney’s trust account and then used to pay for legal fees earned by the attorney and expenses related to the client’s matter. A retainer is the client’s way of guaranteeing to the lawyer that the client is financially able to employ the lawyer’s services and is committed to funding the matter.
The retainer still belongs to the client until it is earned by the attorney or used for legitimate expenses, and must be returned if unused. For instance, if a client pays a $3,000 retainer, and the attorney only accrues $2,000 of billing and expenses on the matter, $1,000 is returned to the client. If the retainer drops below a certain amount, the client is required to replenish it to continue services.
Generally, a retainer is not meant to cover the entire cost of a matter. Rather, it is a prepayment for a certain number of hours of the attorney’s services and expenses associated with beginning a matter. The retainer is an important way that the attorney and client establish a trusting relationship. By funding a retainer, the client is indicating that they can trust that the attorney will hold their funds for them until earned, and the attorney is indicating that they trust the client to continue the financial terms of the arrangement after the initial retainer is depleted.
For further information regarding retainers or other financial terms of representation, contact Fenza Legal Services with any questions that you have.