A retainer agreement refers to a legal contract between clients and their attorneys that allow the clients to “retain” the attorneys for an extended period of time. Rather than contract an attorney on a case-to-case basis, some clients, such as businesses, corporations, and the like, may need an attorney present as they are constantly engaged in legal matters. For these reasons, they may choose to hold an attorney “on retainer” through a retainer agreement, which transforms their one-time agreement into a long-term working relationship. During the period laid out in the retainer agreement, the attorney is obligated to attend to any legal matters the client decides upon. As for the attorney(s), general convention dictates that they charge a lower rate to be held on retainer, as sometimes, they might not have to do any work at all.
As a result, it is common practice for large organizations to hold attorneys on retainer, given the constant legal issues they face, as well as their considerable finances. A retainer can be thought of as a “pre-payment” for the attorney’s legal services, and typically include a clause that offers the client a refund if no need for the attorney’s services arises.
How much does it cost to get an attorney on retainer?
As we mentioned earlier, a retainer is typically cheaper and requires the client to pay the attorney an hourly wage. While this wage fluctuates heavily depending on the field the lawyer specializes in, as well as the scope of his contractual agreement with the client itself, attorneys make $58/hr on average in the United States whilst on retainer.
Clients should keep in mind that the attorney will have to approximate his hours as per the client’s needs and so will present an approximated number of hours within which he/she expects their share of the work to be completed. Many legal bar associations have a cap on the number of hours, which are required to be within a “reasonable” range. Additionally, clients may choose to add clauses that entitled them to refunds for any hours added to the retainer but remain unfulfilled and/or unnecessary at the end of the retainer term. Such agreements typically include a clause that allows the client to terminate the agreement if they find the attorney’s work to be unsatisfactory. In this case, they will have to pay the attorney for the hours they have already completed, but will not be liable to pay for the remaining hours on the retainer agreement.
Unearned Retainers vs. Earned Retainers
There are primarily two types of retainers that pertain to legal services – unearned and earned retainers. The difference is fairly simple – an unearned retainer refers to a retainer agreement in which a portion of the total fee is paid before the work has commenced. It is generally considered to be a token of good faith and a promise that the client will pay the rest after the work has been completed. An earned retainer, on the other hand, is one in which no such deposit is made. When drafting a retainer agreement, this doesn’t present too many complications and is a simple clause that may be added or removed depending on the type of retainer the client desires.
Retainer Agreement for an Attorney (Templates)
ATTORNEY RETAINER AGREEMENT
The following agreement, upon signature of the parties, is enforceable as of _ (Date of signing)
I. THE PARTIES
The parties contingent to this agreement are listed as follows;
The “Client” - With the following mailing address; ____________________________________________________________ The “Attorney” - With the following mailing address; (This may also be listed as “Law Firm” if an entire firm is being held on retainer and not just one attorney.) __________________________________________________________________
II. THE SERVICE
(Here, the attorney will have to detail exactly what services they are providing, as well as the approximated number of hours required to carry out the wishes of the client.)
The “Client” hereby agrees to pay the “Service Provider” the following amount;
_ Yes _ No A fee of __$/hour _ Yes _ No A fee of __$ for the entirety of the contract _ Yes _ No Other ___________________________
or the purposes of this contract, the parties will collectively be referred to as “The Parties.” Additionally, there will be a contingency fee of $__ to be paid at the commencement of the Term mentioned in Section IV.
(This is only applicable in the case of an unearned retainer, where the client has to pay a percentage of the fee up-front.)
IV. THE TERM
The agreement is scheduled to be enforceable between the dates of _ (START DATE) and __ (END DATE). (This may be modified if required to allow for termination at the insistence of either party.)
V. THE SERVICE(s) PROVIDED
For the purposes of this agreement, the “Attorney/Law Firm” agrees to provide the following services to the best of their ability, while complying with all local and federal regulations, laws, policies, and standards;
The “Client” also hereby agrees to pay the “Attorney/Law Firm” according to the following schedule;
VI. ADDITIONAL CLAUSES
Apart from the aforementioned sections, the client and the attorney or firm should discuss what additional clauses they require. There are numerous causes that a client may wish to add, such as a confidentiality clause, non-disclosure agreement, exclusivity clause, and much more!
VII. THE AGREEMENT IN ITS ENTIRETY
The agreement explicitly detailed above hereby represents the entirety of the arrangement between the parties and hereby overrides any previous or existing agreement, contractual or not, that may have been in place prior to the signing of this contract. No additional clauses will be binding unless agreed upon by both parties.
The parties hereby agree to the aforementioned terms and conditions.
CLIENT NAME _
CLIENT SIGNATURE ________ DATE __
ATTORNEY NAME ___
ATTORNEY SIGNATURE DATE ___
LAW FIRM NAME ___
REPRESENTATIVE NAME __
REPRESENTATIVE SIGNATURE __ DATE __
FREQUENTLY ASKED QUESTIONS
A retainer is a simple agreement that legally obligates a lawyer to attend to his/her client’s needs for an agreed-upon period of time. Typically, the client “pre-pays” the lawyer for a number of hours, which the lawyer estimates he/she would require to finish the work assigned to them. After this, the client offers to pay a wage based on the number of hours in advance to “retain” the lawyer’s services.
This largely depends on the client’s wishes and ability to pay the lawyer. A client may hold a lawyer on retainer for any period of time, provided they both agree to it, and the client can afford to pay the lawyer for the approximated number of hours.
Retainers generally mean discounted hours from lawyers, with the average hourly rate in the United States being $58. That being said, hiring and retaining lawyers is an expensive affair and can range between $2,000 to as high as $100,000, as this largely depends on the client, their legal needs, the area of expertise of the lawyer or firm, and a number of other factors. In short, it is rather expensive to hold a lawyer on retainer.