What Are Retainer, Contingency and Statutory Fees
When you are working with lawyers, there are a number of fees that you may need to pay, here are some of them:
- Retainer fee: Retainer fee is paid to the lawyer monthly or annually. You pay retainer fee when you have long-term relationship with the client. When you continue to pay this fee, the lawyer will always be available to you. A true retainer fee is paid by large corporations to law firms, to ensure that legal professionals are available to provide advices and legal services. Retainer fee could be delivered as a deposit or down payment. So clients can put the money in a special account. So, it won’t be necessary for clients to pay directly each month. So, when special account is almost depleted, the law firm could inform you about it. Most of the time, retainer fee also covers basic tasks, such as legal advices. If the law firm notices that there’s an increased risk of litigation, they can warn you about it. You should know that other legal services could be billed separately, so you need to be clear about this. Also, some lawyers may insist that retainer fees in the special account are non-refundable. So, when you terminate the relationship, you may not get the money back.
- Contingency fee: You usually pay this fee after getting compensation from personal injury, accident, worker’s compensation, medical malpractice and others. Many lawyers require you to pay them one third of the money if you are able to win the case. However, the lawyer won’t be paid if you lose the case. It is important to know that even if you lose the case, you will still need to pay court costs, such as compensation for experts and witnesses. The fee agreement documentation should state clearly how much that the lawyer will get obtain, if the case is won. There should be percentages mentioned, before or after expenses have been deducted. The percentage could also depend on the amount of the money that’s won. As an example, the percentage of contingency fee can be lower, if you win a larger amount of money. In any case, you can always negotiate with the lawyer for lower percentage.
- Statutory fee: The local statute law could already set the costs for certain legal work – hence, they are called statutory fees. It means that fees for lawyers are already set by the local court. You should know about the local statutory fees in your area, so you can calculate how much you should pay by the completion of the case. Even if statutory fees are already fully known, they should still be mentioned inside the fee agreement. So, the amount that you should pay is still confirmed. This way, you should be able to prevent any kind of dispute and misunderstanding. Fee agreement should always be mentioned clearly, because any dispute with the lawyer could be detrimental for the progress of your case. In some cases, it is hard to determine whether the case can be resolved, so you need to know whether you have to pay more than the usual statutory fee.