How Do Lawyers Bill?

Following are questions that arise frequently and the corresponding answers in plain English. It is not the intention of this web site to provide legal advice specific to any individual problem; if you have a problem, you should see a licensed attorney to discuss your particular case. The law offices of Roderic A. Carucci are not creating an attorney client relationship through the use or reference to this website.

Q. Do lawyers have more than one method of billing clients?

A. Yes.

Q. What billing methods are most commonly agreed upon between lawyers and their clients?

A. Flat fee, hourly, and contingent fee.

Q. What is a flat fee agreement?

A. The lawyer agrees to perform the agreed upon services or to handle the matter to a conclusion (as defined by the parties’ agreement) for one flat agreed upon amount of money regardless of the time expended to conclude the matter.

Q. What is an hourly fee agreement?

A. The attorney charges an agreed upon hourly rate for his or her time to handle the legal matter for the client. The attorney should keep contemporaneous records of activities performed on behalf of the client and the attorney should send periodic billings to the client which details these activities.

Q. What is a contingent fee agreement?

A. Generally, the lawyer invests his time in a case for a fixed percentage of the recovery at the end of the case, either through settlement or trial. The percentage can vary depending upon the complexity of the case and issues. Normally, an auto accident case would have a lower contingent fee percentage than a case requiring special expertise such as medical malpractice. The client is responsible for out of pocket expenses incurred on behalf of the client by the attorney. Such out of pocket expenses include filing fees, court reporters, expert witnesses, investigators, deposition transcript costs, long distance telephone, copies, fax, etc. If the attorney advances these costs, then the client will ulitmately have to reimburse the attorney out of the client’s share of the recovery.

Q. If I retain a lawyer should I have a written retainer agreement with the attorney?

A. Yes, in all cases. However, the rules governing lawyer conduct only require a written retainer for contingent fee cases.

Q. Is a contingent fee agreement a billing device which can be used for any civil type of legal matter?

A. No. Lawyers are forbidden to handle family law matters (e.g. divorce, custody, visitation, etc.) on a contingent fee basis. Although we are not dealing with criminal matters in this section, it should be noted that criminal cases cannot be handled on a contingent basis by the attorney either.