Written by Troy Marsh |
What does the attorney’s fee cover, and what doesn’t it cover?
If I represent you, this question will be answered, in detail, in a written agreement that you and I will sign. Generally, an attorney’s fee is compensation for professional legal services performed by an attorney for a client, in or out of court. Our written fee agreement, which I require in every case, will contain an explanation of the amount of my attorney’s fee (or the method of calculating the attorney’s fee), the payment arrangements, the nature and scope of my representation, the legal services covered by the agreement, and a reminder that no promises or guarantees as to the outcome of the case are being made by me or anyone at my firm (just like no one can guarantee that the sun will come up tomorrow).
There are several different ways that an attorney may charge for representing a particular client in a particular case. In my practice, I charge a flat fee in criminal defense cases and a contingent fee in injury and wrongful death cases.
A flat fee covers all legal services connected with the case, as defined by our written fee agreement. The services covered by the flat fee may vary from case to case. For example, in a DUI case, my client and I may agree that my flat fee will cover all legal services connected with pre-arraignment motions, arraignment, and pretrial motions but not a trial or appeal. In another case, my client and I may agree that my flat fee will cover all legal services connected with pretrial motions, hearings, and a jury trial, but not arraignment or an appeal. To hire me in a criminal defense case, the client pays the total flat fee, whatever amount we have agreed upon, and signs a written fee agreement.
In tort cases, such as a car accident case, I charge a contingent attorney’s fee. A contingent fee means that I take no fee from the client up-front but get a fraction, usually 1/3 to 2/5 of any gross award (verdict, settlement, or judgment). If there is no recovery, my client is not responsible for paying any attorney’s fee.
Whether your case is a personal injury case or a criminal defense case, the amount of my fee depends on many factors, including the complexity of the case, the number of parties and witnesses, the court, the venue, your criminal history, your driving history, the existence of any novel legal issues, and many, many others.
EXPENSES AND COURT COSTS
An attorney’s fee does not cover expenses or court costs. Expenses are things like postage, overnight delivery costs, long distance telephone calls, expert witness fees and expenses, expenses paid to health care providers for copies of medical records and bills, private investigator fees, costs for photocopies, court reporters’ takedown fees and expenses, court reported transcripts, travel expenses for the attorney and investigators, discovery expenses, and any and all other expenses the attorney considers reasonable necessary for the proper representation in the case.
Court costs are filing, and other fees, charged by the court. In an injury or wrongful death case, my client(s) and I will decide, before the fee agreement is signed, who will pay the expenses and court costs as the case progresses. We may agree that I will pay all court costs and expenses as they are incurred, and the client will reimburse me from any gross recovery (settlement or judgment). That way, the client is not required to pay expenses until the case is settled or a judgment is recovered.
In the event of a recovery, the attorney’s fee will be calculated and deducted from the gross award, and any expenses will be reimbursed or otherwise paid from the remaining balance of the proceeds. For example, suppose I win a judgment in an injury case for $3,000.00. The loser pays the judgment by money order in the amount of $3,000.00, payable to my client and me. I deposit the money order in my trust account and prepare a settlement statement with a detailed listing of who gets paid and how much is paid. Following is a summary of what may appear on a settlement statement:
Gross award: $3,000.00
Attorney’s fee: 1/3
Expenses and court costs: $100.00
In this case, the attorney’s fee is 1/3 of $3,000.00, which is $1,000.00. Stated another way, we divide $3,000.00 by 3, which is $1,000.00. Note that the attorney’s fee is 1/3 and is not 33.3%. My firm writes a check from my trust account in the amount of $1,000.00 payable to me for the attorney’s fee. That leaves $2,000.00 in the trust account.
Next, my firm writes a check from my trust account in the amount of $100.00 to reimburse me for the expenses and court costs that I paid upfront. That leaves $1,900.00 in the trust account. My firm writes a check from my trust account in the amount of $1,900.00 payable to my client. Of course, these numbers are purely hypothetical, are used for illustrative purposes only, and are not related to any actual case.
In some cases, I agree to pay costs and expenses as they are incurred, and the client will immediately reimburse me within 30 days after receipt of my invoice. In other cases, we may agree that I will pay all expenses without any reimbursement from my client. As with the attorney’s fee, the payment of expenses and court costs is negotiable and can vary from case to case.
In a criminal defense case, such as a DUI case, my client and I will decide, at the time the fee agreement is signed, who will pay the expenses and court costs and expenses as the case progresses. One main difference between a criminal defense case and an injury or wrongful death case is that there is no settlement or judgment from which the attorney can be reimbursed. Therefore, I usually pay the expenses and court costs as they are incurred, I send the client an invoice, and the client reimburses me immediately.
The amount of expenses and court costs may vary greatly, depending on the type of case, the number of parties and witnesses, the need for expert witness assistance, and many others. In an injury or wrongful death case, expenses may range from $500.00 to $20,000.00 or more. In a criminal defense case, expenses may range from $3.00 to $500.00 or more. While I will give my best guess about the amount of expenses that may be incurred in a particular case, there is no way to predict the exact amount of future expenses in any case. However, all expenses will be reasonable and necessary for the proper representation of my client in the case.