What You Need to Know About Attorney Fee Agreements
If a lawyer wants to take your money without providing you with a written Fee Agreement, there is good reason to be concerned.
The only reason a lawyer would not want to have a written Fee Agreement is so that they can take advantage of an unwitting client.
When hiring an attorney, it is imperative to have a written fee agreement. Criminal attorney fee agreements set out the services the attorney will perform for you and the type and amount of fees and costs you are obligated to pay for the services rendered.
When discussing fee agreements with an attorney, remember that the attorney must consider many factors when selecting the type and amount of the fees. These factors include the attorney’s experience and background and the required time and attention for your defense. Therefore, legal fees vary from attorney to attorney.
Michigan Rule of Professional Conduct 1.5(b) states a strong preference by the State Bar of Michigan that Fee Agreements be in writing. However, this rule is not mandatory for criminal defense cases (non-contingent fee arrangements). People who fire their previous attorneys regularly hire LEWIS & DICKSTEIN, P.L.L.C. The most common problems are no written fee agreement, disagreements regarding how fees were structured, the total paid, or how much the attorney should return. Almost all criminal defense attorneys in Michigan charge flat, non-refundable legal fees. Legal fee structures are more complex than you may think. A misunderstanding or miscommunication will invariably result in a fee dispute without a written Fee Agreement.
No written criminal attorney fee agreement? Time to find a new lawyer.
If you are going to hire a criminal defense attorney and they do not offer you a written fee agreement, leave immediately and seek out a more ethical lawyer. Reluctance to provide a written Fee Agreement is a sure sign that the lawyer may intend to take advantage of you or desire to keep you in the dark regarding the actual costs of the legal services. Some attorneys will try to get a client to agree to hire the lawyer without a written fee agreement and will only provide one if asked.
Top Five Reasons for a Written Criminal Attorney Fee Agreement
There are several reasons why an attorney’s fee agreement should be in writing:
Clarity: A written fee agreement provides clarity and helps to avoid misunderstandings between the attorney and the client. It clearly sets out the scope of the legal services to be provided, the fee structure, and any expenses or costs that may be incurred.
Record Keeping: A written fee agreement serves as a record of the fee arrangement between the attorney and the client. This can be helpful in the event of a dispute or if there is a need to refer back to the terms of the agreement later on.
Ethical Requirements: Many states, including Michigan, have ethical rules that require fee agreements to be in writing, particularly when the fee is contingent on the outcome of the case. Written agreements can help to ensure that the fee arrangement is ethical and in compliance with these rules.
Protection for the Client: A written fee agreement can protect the client by ensuring that they are not subject to unexpected fees or charges. It can also provide a clear understanding of what the client is responsible for paying, when payments are due, and any interest or penalties that may be incurred if payments are not made on time.
Protection for the Attorney: A written fee agreement can also protect the attorney by ensuring that they are paid for their services in a timely manner and in accordance with the terms of the agreement. It can also help to avoid disputes over fees or payment arrangements.
A written fee agreement provides clarity, serves as a record, meets ethical requirements, protects the client and attorney, and helps to avoid misunderstandings or disputes. It is, therefore, in the best interest of both the attorney and the client to have a written fee agreement in place when you hire a criminal defense attorney.
Frequently Asked Questions
What is a fee agreement?
A Fee Agreement or Retainer Agreement is a contract between a lawyer and a client. The Fee Agreement specifies the parameters of the work to be done on the client’s behalf and the cost of legal services. The Fee Agreement further specifies the cost of legal fees and how the lawyer earns the fees.
What percentage do most lawyers take as a contingency fee?
A lawyer in a criminal case cannot ethically charge a contingency fee under the Michigan Rules of Professional Conduct. Specifically, the legal fees cannot correspond to the case’s outcome in a criminal matter. For example, a criminal defense attorney cannot enter into a Fee Agreement with a client that provides one fee to take the case and a second fee depending on if the client is acquitted or if charges are dismissed.
What is the most a lawyer can charge?
Attorney fees in Michigan must not be excessive, meaning that the amount of the legal fees must not shock the conscience. A fee is clearly excessive when, after reviewing the facts, a lawyer of ordinary judgment would unequivocally conclude that the fee is far higher than a fair fee. The factors that determine if a fee is excessive include:
- the time required, the complexity of the case, and the skill necessary to perform the legal service;
- if apparent to the client, the need for the lawyer to give up other work, so they have enough time to dedicate to the case;
- the fee customarily charged in the locality for similar legal services by similarly experienced and skilled lawyers;
- the importance of the case and the results obtained;
- the time limitations imposed by the client or by the circumstances;
- if the lawyer has provided work for that client in the past; and
- the experience, reputation, and skill of the lawyer or lawyers performing the services.
What type of fee agreements must be in writing?
Michigan does not require written Fee Agreements; however, the State Bar of Michigan strongly encourages written Fee Agreements to ensure that the lawyer and the client clearly understand the legal fees charged and the scope of legal representation.
How are legal fees calculated?
Generally, attorneys calculate the fees in a criminal Fee Agreement based on the severity of the charge, the importance of the outcome, the experience and reputation of the lawyer, and the case’s complexity. A legal fee should be fair and affordable yet accurately reflect the attorney’s experience, reputation, and skill.
What is the meaning of a retainer fee?
A retainer fee is similar to a down payment. A retainer payment is the first payment made on the total legal fees charged by the lawyer or law firm. For example, if the legal cost is $10,000.00 and the retainer is $5,000.00, the retainer fee must be paid upfront to start representation, and then the $5,000.00 balance would be due in an agreed-upon time frame.
What is an engagement fee?
The client pays an engagement fee to hire a lawyer and guarantee their availability.
Should legal fee agreements be in writing?
Fee Agreements used to hire a lawyer should be in writing to protect the client and the attorney. A Fee Agreement should specify the legal fees and the services the lawyer will provide. A well-crafted, enforceable, and ethical Fee Agreement will plainly demonstrate the lawyer’s fees and the scope of their representation.
How do lawyers bill their clients?
The Fee Agreement should specify when and how the client must pay legal fees if a lawyer charges a flat fee. In many cases, the client pays the entire flat fee to initiate representation, and there will be no future bills. If the client pays only a retainer and owes a balance, it is helpful if the Fee Agreement specifically indicates when the lawyer expects the balance of the legal fees.
No Fee Agreement is a Red Flag
When a lawyer doesn’t want to put something in writing, it is a red flag. The only way to be assured that you and the lawyer have a clear meeting of the minds on legal fees and costs is if the agreement is in writing. Make sure you keep a copy of the fee agreement for your records.
Once the attorney answers your questions, be sure you understand everything in the agreement before signing it – READ THE AGREEMENT! Again, if the lawyer rushes you or doesn’t seem to want you to look too closely at the contract, you have good reason to be concerned.
The attorneys with LEWIS & DICKSTEIN, P.L.L.C. always use written Fee Agreements, and we take the time to review the contracts with every prospective client. Our attorneys will not ask you to sign the Fee Agreement until you’ve expressed a good understanding of the document and received answers to all of your questions.
Call us today at (248) 263-6800 for a free consultation or complete a Request for Assistance Form. We will contact you promptly and find a way to help you.