Attorney Fees, Legal Fees and Fee Agreement

Author: Steve Dimeck

Based on the type and complexity of your legal situation, your attorney may apply any one of the fee arrangements (listed below) to your case or a combination of few. Make certain that you fully understand it. The typical fee arrangements are: initial consultation fee, hourly fee, standard fee, retainer fee, contingency fee and statutory fee. Of course, the ball doesn't stop there. You will most likely be hit by other legal fees outside of your attorney fee arrangements - covered in Part 4 of this multi part article. In this Part 2 you will have an opportunity to read about the initial consultation fee, hourly fee and the standard fee. Please refer to Part 1 to read the introduction to legal fees and to read about the fee agreement.

Fee Arrangements

Initial Consultation Fee - This fee is what the lawyer charges for your first visit. Make sure you ask what the fee is when you make your initial appointment. Some attorneys charge their usual hourly rate for this visit, some charge a reduced rate, while others offer free initial consultations. Usually by the end of this initial consultation you will know whether you want to hire this lawyer, and the lawyer will decide if he or she wants to take your case. Don't expect to get much legal advice, if any, during this visit. This visit is where you get to interview the attorney and the attorney gets to hear your legal issue.

Hourly Fee - This fee can vary from lawyer to lawyer. It can also vary from city to city, the type of problem, and the amount of experience the lawyer has. More experience the lawyer has, more confidence he or she has in handling your case, therefore they could charge more. At your initial consultation, always ask the lawyer to estimate how long your case will take. But, don't forget that circumstances may change, and your case may take longer than the lawyer expected at the beginning. Some attorneys may consider reduced rates for low-income people. These attorneys will make a decision based on your financial situation, the type of assistance you are seeking, and their current caseload, whether they are willing to lower their fees for you or not.

Remember, if the lawyer decides to charge you by the hour, as amusing as it may sound he or she will track and bill every minute spent working for you. This includes answering your phone calls, preparing documents, doing research, talking to the other side's lawyer, going to court and so on. In addition to that, don't forget to ask if other attorneys or employees at the firm will be spending time on your case and at what rate, because you will be billed for their time too.

A lawyer may ask you to sign a promissory note as security for the fees. Also, a bankruptcy attorney will require payment in advance, since that fee, if not paid before filing bankruptcy is dischargeable by you in the bankruptcy. So, the attorney wants to make sure he or she gets their money before you're no longer required to pay your debts. In addition, a lawyer may request a retainer fee as a down payment. This means that the legal fees will be deducted from the retainer, at the agreed upon hourly rate, until the retainer is used up. Then, the lawyer will either ask you to replace the retainer or bill you for any additional time spent on your case. In any case, always ask for a receipt for fees you have paid. In case of a dispute, the receipt is your evidence.

Standard (Flat) (Fixed) Fee - Regardless of how they refer to it, this is a set fee used for routine legal matters, such as drawing up a will, purchase or a sale of a property, title examination, handling an uncontested divorce, and such. It basically means that regardless of how much time the lawyer spends, this fee is used when the lawyer is performing a specific service with a predictable time commitment. When you and your lawyer agree to a fixed fee, make sure that you know what it does and does not include. Also, you need to ask your lawyer (and get it in writing, i.e. e-mail, letter, memo) whether the fee could change if your case becomes unexpectedly complex.


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