Law Articles

Return to Law Dictionary Index

Lawyer Billing Rates

When it comes to billing and how lawyers charge there are various methods. The most common billing arrangements types are an hourly fee, a contingency fees and a flat fees. Some lawyer will agree to a free initial consultation over the phone or even in person. Otherwise, there usually will be a fixed price for the initial consultation. At the end of the initial consultation, you should agree upon a fee arrangement and sign a contract for representation detailing what your lawyer specifically will do for you, how much you will be charging and what method will be used.

Hourly Fee

Hourly rates are the most common arrangement. In this case, the attorney gets paid an agreed-upon hourly rate for the hours worked on a client's case or issue until it's resolved. Some examples when this will be used is when drafting wills and trusts, representation of a party to a divorce and representing a client. Each hour billed should be itemized in your invoice and a retainer is generally required. Clients receive periodic statements to show hours billed against the retainer and any additional fees due. Other expenses, including long distance phone charges, documentation and mailing fees, etc. may be billed to the client, in addition to the hourly fee.

Contingency Fee

A contingency fee is used when the outcome and/or recovery of damages is not absolutely certain. Some examples when this rate may be applied are personal injury and accident cases, including auto accidents, worker's compensation, employment discrimination, etc. Upon agreement of representation, you should sign a contract for representation, outlining the fees to be charged. In these cases, the fee will be a percentage of the damages awarded. A common range in this fee arrangement is 25% to 40% of the recovery. The client in such cases is generally not required to reimburse the attorney for the regular expenses incurred in the case. Generally, the client will be required to pay only filing fees and special expenses (expert witness fees, for example) which are paid out of the client's portion of the award. If no recovery is made, the client usually will not be required to reimburse any expenses, except in the event that the client withdraws the claim after expenses have been incurred. In such a case, the client will be billed for reasonable fees and expenses.

Flat Fee

Often, the most important question (rightly so) on a client's mind is "How much is this going to cost me?" Some lawyer will offer flat fees for some matters. Some examples when this might apply is traffic ticket defense, uncontested divorce, and immigration proceedings. It is important to note that any expenses (long distance phone or fax charges, court costs, expert witness fees, etc.) incurred under flat fee arrangements are usually still the clients responsibility. The obvious advantage of a flat fee is that you will know your costs from the start.

Retainers

Regardless of the payment method, it is not uncommon for a lawyer to ask for a retainer. This an upfront amount paid to the lawyer. As expenses are incurred the lawyer will draw money from this retainer. Expenses and hourly fees incurred will be paid out of this retainer until depleted, after which fees and expenses will be billed to the client. Depending on the case, an additional retainer may be required after the initial retainer is exhausted. In a few cases, lawyers will be open to payments arrangements instead of a retainer.

Return to General Practice

Return to Law Dictionary Index