If you’re facing a legal issue, getting a lawyer’s help is almost always a good idea, but legal representation comes at a cost. At the outset of your case — and certainly before you officially hire your lawyer — you need to understand how the attorney will be paid, and get a ballpark estimate of the total cost of the attorney’s services and related expensess.
Consider Your Willingness to Spend
Legal issues can vary widely in terms of significance and severity, but legal services aren’t cheap. So right up front, you should think about how much you’re comfortable spending in order to resolve your issue. This is an important practical consideration in any kind of civil case. Of course you’d like to have your car repaired properly, or to have that construction defect remedied, but are you willing to spend what it takes to get a court to rule in your favor? Learn more: Should You Sue?
When you’re shopping around for legal services, always ask the attorney to fully explain their fees and billing practices. Don’t hesitate to ask detailed questions. A lawyer’s willingness to discuss fees is an important indicator of client service.
Typical Fee Arrangements
In most civil cases, an attorney will be paid under one (or a combination) of the following fee arrangements:
- hourly rate
- flat fee
- retainer, or
- contingency fee.
Hourly rates are the most common arrangement. Here, the attorney gets paid an agreed-upon hourly rate for time spent working on all aspects of a client’s case until it is resolved.
The hourly rate depends on each attorney’s experience, operating expenses, and the location of his or her practice. In rural areas and small towns, lawyers tend to charge less, and fees in the range of $100 to $200 an hour for an experienced attorney are probably the norm. In major metropolitan areas, the norm is probably closer to $200 to $400 an hour. Lawyers with expertise in specialized areas may charge much more.
But consider that cheaper isn’t necessarily better. A more expensive lawyer with a lot of experience may be able to handle a complex problem more quickly. Also, an experienced attorney will be able to better estimate how many lawyer hours a particular matter will take to resolve.
Where a legal matter is simple and well-defined, lawyers typically charge a flat fee. Examples of flat fee matters include wills, uncontested divorces and simple bankruptcy filings. If an attorney suggests or has advertised a flat fee, be sure you understand exactly what that fee will and will not cover. The flat fee might not include expenses such as filing fees.
A retainer typically operates as an advance payment on an attorney’s hourly rate to handle a specific case. The lawyer puts the retainer in a special trust account and deducts from that account the cost of services as they accrue. During the course of legal representation, clients should review periodic billing statements reflecting amounts deducted from the retainer. (Learn more about Attorney Responsibility for Client Funds.
Most retainers are non-refundable unless labeled “unreasonable” by a court. If you decide to drop a case that your lawyer has worked on before the retainer has been exhausted, you might forfeit the remainder.
In certain types of cases, attorneys work on a contingency fee basis. That means the attorney takes no fee from the client up-front, but gets a percentage (typically one-third) of any settlement or money judgment obtained on behalf of the client. Contingency fee arrangements are typical in:
- automobile accident lawsuits
- medical malpractice claims
- other personal injury cases, and
- debt collection cases.
Courts often set limits on the contingency fee percentage a lawyer can receive in certain kinds of cases. Learn more: What is a Contingency Fee?
Expenses and Court Costs
Little things add up. Carefully discuss with your lawyer any anticipated miscellaneous costs so that you can estimate them up front and avoid any unpleasant surprises. Be prepared to talk about who will foot the bill (at the outset and upon resolution of the case) for court costs, filing fees, secretarial time, and delivery charges. Learn more about Court Costs in Civil Lawsuits.
In addition, find out about cost of paralegals and other support staff. A good paralegal’s time, for example, may be billed out at $50 to a $100 an hour or perhaps more. It would not be unusual for a legal secretary’s time on things like document production to be billed out at perhaps $25 to $50 an hour. is the attorney absorbing these costs as part of representation, or will you wind up with a bill for these services?
Keeping Track of Legal Fees
Get your fee agreement in writing. If an attorney is unwilling to put the agreement in writing, cross that attorney off your list. Most states require written fee agreements for most cases.
Ask your attorney to include in the fee agreement a provision for periodic, itemized billing. An itemized bill should list and describe all charges so that you can review them and compare them to your fee agreement.
You might want to arrange for a ceiling or limit on fees. You might also require your lawyer to get your approval before proceeding beyond a certain amount in legal costs. If you’ve hired an attorney to recover a $10,000 debt, you probably don’t want to pay $8,000 in legal fees to resolve the matter.
Free or Low-Cost Legal Services
Low-income clients may qualify for free representation in landlord-tenant and divorce cases. There may also be legal clinics and other organizations in your area that can provide free or low-cost legal services. Some attorneys and firms also dedicate a small percentage of their practice to pro bono work. Start by contacting your state’s bar association, or do an online search.
Depending on the nature of the legal issue you’re facing, you also want to check the fine print of any applicable insurance policy you’ve taken out and see if it requires your insurance company to provide an attorney to defend you in a lawsuit.
Many unions provide free legal services to their members. If your case or claim is work-related, talk to your union representative.
Finally, certain rights or advocacy groups might want to get involved in your case. For example, if you are challenging an unlawful deprivation of your civil liberties or an infringement of your right to free speech, an organization such as the American Civil Liberties Union may be interested in helping you.