No matter how well you know your attorney or how "simple" you think your case is, you should always have a written representation agreement (sometimes called a fee agreement) with your lawyer. These contracts set out the terms of the attorney-client relationship and the fees and compensation that you will owe.
While some attorneys use formal contracts for a representation agreement, often running many pages in length, other lawyers use simple, one-page letters. The length and complexity of the contract don't matter as much as the content. The agreement should carefully outline and explain certain issues, such as how much and when you will pay your lawyer, who is responsible for court fees, and whether a paralegal or a lawyer will work on the case.
Reasons To Have a Written Representation Agreement
The simple reason to have a written agreement with your attorney is to hold everyone accountable. Most disputes between lawyers and their clients are about money, whether it is how much the attorney is owed or how much the client is owed as a refund. A written contract makes it easier to resolve these disputes quickly and without the need for court intervention. It is highly effective to point to a specific part of a written contract to prove your point.
There are other reasons (unrelated to money) to have a written representation agreement. For instance, if you only want licensed attorneys working on your case and not paralegals, then you can put this in the terms of the contract.
These representation agreements are also a great way of laying out how the client wants their relationship with the attorney to work. For example, more "hands-on" clients may wish to have an attorney call with a status update once a week. Your contract can include this.
Finally, putting the agreement in writing forces both client and attorney to be very clear about what they expect of each other. Oral representation agreements may be subject to different interpretations, depending upon the side. However, a written representation agreement makes both attorney and client explicitly aware of the terms and scope of the contract.
What To Include in Your Representation Agreement
Your representation agreement should include the attorney's fees, associated costs, and how and when you will pay. In addition, lawyers work on different pay structures. Generally, attorneys will work on an hourly, fixed, or contingency-fee basis. Putting the terms of payment in place is essential.
For many types of cases, this is the most common pay structure. Like paying an hourly employee, you will pay your attorney for each hour, or part of the hour, that they work on the case. Rates typically vary from as little as $75 per hour to more than $500 per hour. In addition, you should expect to pay for time spent on the case by other people in the office, such as paralegals. The rates for these workers usually cost between $40 and $80 per hour.
If you and your attorney agree on an hourly fee arrangement, the contract should state how often you will pay the lawyer (weekly, monthly, yearly, after the case is over, etc.) and how much detail the bill will include. In addition, there should also be some mention of how the client could go about challenging the attorney's time spent on some tasks.
This is a relatively new method that attorneys sometimes use to bill their clients. Under this fee structure, an attorney will charge a client a fixed amount for a specific type of case. Attorneys who do one type of case or transaction multiple times are the most likely to charge fixed fees. For example, an attorney may charge a client $500 for handling a traffic ticket case. The representation agreement should include terms that do not allow the attorney to charge more than the agreed-upon amount for this type of arrangement.
This type of fee arrangement is most common in personal injury cases. This is great for clients who do not have much money to pay attorneys upfront. Instead, the attorney agrees to take the case in exchange for a certain percentage of whatever award the client recovers in a lawsuit. If the client loses the case, the attorney does not get paid.
Once you agree to a contingency fee arrangement, your representation agreement should include terms that set out what percentage of the eventual award or settlement the attorney will receive. Common contingency fees range from 20% to 40%. Some attorneys change their percentage depending on whether the case settles or goes to trial. Your agreement should include this language.
Costs and Fees
Your representation agreement should also include clauses covering certain costs and fees associated with your case. These costs can include court fees, witness fees, travel expenses, filing and copying fees, and more. It should be no shock that litigation can be quite expensive. These fees must come from somewhere, and your representation agreement should specify from where. If you are expected to pay for all filing fees, that should be in the contract with your lawyer. Attorneys working under a contingency fee basis will often cover all these costs and fees up front and deduct them from the eventual award.
Even though fee arrangements and terms dealing with money are the primary reason for having representation agreements, there are other terms your contract should include as well, such as:
- The extent of the representation: The contract should clarify how far your attorney will represent you in your case. For example, some attorneys will not handle appeals, and if this is so, your agreement should include such a term.
- Ending the attorney-client relationship: The representation agreement should include a term regarding the relationship's ending and under what circumstances it can occur. For example, a contract may state that the client has the right to fire their attorney at any time, without reason, or that the client can only fire the attorney for just cause.
- Client files: The contract should specify how and at what cost the client can obtain a complete copy of their client file held by the attorney.
- Who is working: The contract should specify who will do the work, meaning who will do the research for the case and who will argue it in court if litigation is necessary.
- Powers of attorney: The contract should lastly specify what powers, if any, the client gives to the attorney. For example, if a client does not think they can make a judgment call on something, the agreement can pass this authority to the attorney.
Talk About Terms as Soon as Possible With Your Attorney
While haggling over contract terms may be stressful, attorneys know how to handle these conversations. Respectable attorneys will be transparent with you about expected costs and why they structure their fees the way they do. If you feel a prospective attorney is not being honest with you, you do not have to sign a contract for representation.