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What Is a Retainer?

A retainer is a sum of money given to a lawyer to secure his or her services. Traditionally, the purpose of the retainer was to "retain" the attorney for oneself, so that he or she would be prevented for acting on behalf of the adversary. Nowadays, however, most people do not hire an attorney until they need one. The retainer, therefore, has taken on a somewhat different meaning.

These days, the sum of money called a retainer usually represents one of two possible things; it is either an advance against the fees and costs to be incurred in a particular case, or it is in the nature of a "flat fee" which the attorney has agreed to accept in return for handling a particular matter. The difference between these two concepts of a "retainer" should not be overlooked.

The flat fee retainer is the amount of money that the client pays for all of the attorney’s services to be incurred in connection with a particular matter, and it is considered earned by the attorney upon his or her engagement. It becomes the property of the attorney when received. It does not, of course, guarantee a particular result; it means only that the client will not have to pay any more money, regardless of how much work is involved in a particular case. For the attorney, it represents a guaranteed fee, and it may work out to his or her advantage if the matter can be concluded quickly. On the other hand, it may work to the attorney’s disadvantage, if the case proves to be long and difficult.

The other type of retainer (which this office requests in all of its family law matters) is actually an advance against the fees and costs to be incurred in the case. The money goes into the lawyer’s trust account, and the lawyer may not take it out of the trust account and keep it for himself until it is earned, or until it is otherwise spent on the client’s behalf. That is, the retainer not only goes toward paying the lawyer, it may also be used to cover the lawyer’s out-of-pocket expenses (such as service fees, filing fees, copies, telephone expenses, witness fees, etc.). This type of retainer shows the good faith of the client and assures the attorney that he or she will not be left "holding the bag" for all the time and money invested in the case, at least during its initial stages. Some fee agreements require that a retainer be "refreshed" from time to time, such that the attorney will always know that there is money available to cover his time and out-of-pocket expenses.

Interest generated on unearned retainers kept in Lawyers’ trust accounts is contributed to the state’s IOLTA program, which is used to fund various programs providing legal services to the poor. Accordingly, even if there has been no activity on your case, you will never see your retainer increase in value. Once your case has concluded, any unearned portion of "advance against fees and costs" type retainer should be refunded promptly.

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