Understanding the Different Types of Retainers at Minc Law
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When it comes to hiring legal representation, understanding the different types of billing methods and payment structures can be overwhelming. We pride ourselves on transparency and strive to empower clients to understand the various payment structures used by law firms so that they can make informed decisions.
At Minc Law, retainer fee agreements are the primary payment structure that we use for hourly and litigation matters. A retainer fee is an upfront payment made by a client to secure the time and services of a professional like an attorney. The fee amount varies based on the type and extent of work agreed upon between the client and the attorney.
After the retainer is paid, the funds are placed in a separate account. Then the law firm will then use these funds to “bill against that amount” as work is performed. Think of a retainer as a deposit towards legal work to be performed.
The different types of retainers that are utilized at Minc Law include:
- Standard Retainers;
- Evergreen Retainers;
- Minimum Fee Agreements (MFA).
In this article, we will provide a comprehensive overview of each of these types of retainers used at Minc Law, including how they work and the types of legal matters for which each retainer is typically used. We will also answer some frequently asked questions related to retainers.
Retainer Type #1: Standard Retainer Fee Agreements
A standard retainer fee agreement is the most common type of retainer used at Minc Law. This agreement typically applies to hourly matters and some litigation matters. A retainer fee acts as a deposit for the attorney’s time working on your matter. If the attorney meets your goals before the retainer is used up, any remaining balance will be refunded to you.
It is worth noting that there is no one-size-fits-all cost when it comes to retainers.
For example, some matters may only require a $3,500 retainer whereas other matters like litigation, which tend to be an extensive process and use of attorney time, typically begin at $7,500.
How Does a Standard Retainer Fee Agreement Work?
When you enter into a standard retainer agreement, the fee is a deposit that covers the attorney’s time spent on your matter. The retainer amount varies based on the type and scope of the work you need.
Once a client signs an engagement agreement with the firm and the retainer fee is deposited, an attorney will begin work on the matter, billing against that retainer. Every month, the client is sent an invoice that details the work completed. The invoice also details the amount that will be deducted from the retainer to pay the invoice and the remaining balance of the invoice. This is crucial for ensuring that all clients know when they may be approaching the ‘end of their retainer’ and how much is still left in a retainer’s balance.
If the attorney’s time billed exceeds the amount of the retainer, you will be invoiced for the remaining balance. Conversely, if the attorney’s time billed is less than the amount of the retainer, you will receive a refund for the remaining balance within the retainer.
For further reading, please see our comprehensive resource explaining ‘How to Read Your Minc Law Invoice’
Types of Matters That Use a Standard Retainer For Hourly Services
Standard retainers are commonly used for hourly matters, such as court record removal, social media and adult content removal, and general content removal services, including demand letters.
Some matters may begin as hourly matters but then turn into litigation matters. Such cases typically use standard retainers but the attorney may request an additional deposit prior to beginning litigation. This is most commonly seen with social media issues where we intend to resolve the issue outside of court but then for a specific reason(s) we must take things a step further and initiate litigation.
Type of Retainer #2: Evergreen Retainer for Litigation Services
An evergreen retainer is a type of retainer agreement where the retainer must remain at a specified amount. This means that the client is sent an invoice every month and must either pay the invoice or replenish their retainer to bring it back to the agreed-upon amount.
Why Do We Use Evergreen Retainers at Minc Law?
Evergreen retainers are used as a way to ensure that the costs of a legal matter are always paid in advance. Clients pay a fee into a separate trust account in advance, and we bill against this retainer each month as legal services are performed.
If additional work is necessary, we require payment to replenish the retainer. This way, the retainer stays at the same amount until the case is concluded, making it “evergreen.”
The key benefit of an evergreen retainer is that it acts as a safety net for both the client and the attorney since the retainer is never depleted. This ensures that the attorney can continue to work on the case without interruption, and the client has peace of mind knowing their legal costs are covered. In some cases, the attorney may be able to offer a lower retainer amount if an evergreen retainer is used.
How Do Evergreen Retainers Work?
This type of retainer is used by many lawyers and other service professionals as an advance payment that is maintained at a specific minimum balance. Any charges incurred as they work on the case are then billed separately.
At Minc Law, once your monthly invoice has been sent you can either choose to pay that invoice directly or allow the firm to withdraw the invoice amount from the retainer. From there you will be required to make a deposit back into the retainer to bring the balance back to the agreed-upon amount.
For example, your initial retainer is $7,500 but the agreed-upon amount that must remain in your account is $5,000. You are sent an invoice for $3,200. The firm can deduct this amount from the retainer however you will need to make a $700 payment to bring the balance back to $5,000.
What Kinds of Matters Use an Evergreen Retainer?
An evergreen retainer is primarily used for litigation services and international clients. It may also be used in local Ohio litigation matters and other situations where a Minc Law attorney determines that it may be most appropriate for resolving a client’s issue.
Evergreen retainers are commonly used for matters that require filing Joe Doe lawsuits to unmask anonymous perpetrators, litigation over false and defamatory reviews, as well as other social media-related issues.
As a bottom line, any matter that is litigation-based, meaning that we are filing a complaint in court, is typically a good fit for an evergreen retainer.
Type of Retainer #3: Minimum Fee Agreements (MFAs)
An MFA retainer is a minimum fee agreement that is used for matters that require urgent attention and our particular knowledge, skills, and experience. The cost of the MFA will vary depending on your specific matter and what content needs to be removed. During your consultation, the attorney will discuss the cost of an MFA so you know the amount before entering an agreement.
It is important to note that even though there is a fixed minimum fee, you may owe additional funds if the attorney’s time spent on the matter exceeds the minimum threshold.
For example, if your minimum fee is $3,500 and your attorney’s hourly rate is $300, your MFA covers about 11.2 hours of the attorney’s time. If your matter ends up requiring 15 hours of the attorney’s time, you would be responsible for the additional 3.8 hours.
How Does a Minimum Fee Agreement Work?
To begin work on a matter, an MFA requires that a minimum fee be paid upfront. This serves as a baseline cost for the work that needs to be done.
For example, if a client wants to remove content published by a news agency, the minimum fee for this service is usually $3,500. However, if the attorney requires additional funds to complete the job, you will be invoiced for the extra time needed.
Also, minimum fee retainers are earned upon receipt. This means that as soon as you pay the minimum fee, the attorney has earned that money and can use it to begin work on the matter. This differs from other types of retainers, such as standard retainers, which act as a deposit that is refunded if there is any remaining balance.
What Types of Matters Do We Use MFAs For at Minc Law?
MFAs are typically used for matters that require urgent attention. At Minc Law, we require an MFA for all sextortion and news article matters. Additionally, some social media content removals may also require an MFA.
What Happens When My Retainer is Exhausted?
When your retainer has been exhausted, your attorney will contact you to discuss the situation and determine if you would like to continue with the legal matter. If you decide to proceed, the attorney’s hourly rate will be billed against your retainer. Our attorneys’ hourly rates range from $300 to $600, depending on the attorney’s experience and the nature of the legal matter.
At the end of each month, you will receive an invoice that outlines the billing details for the work performed on your matter during that period. It will detail the amount of the retainer used and any remaining balance, if applicable. It is essential to review these invoices carefully and contact your attorney if you have any questions or concerns.
It is worth noting that any calls made to your attorney regarding billing or retainer matters will not be billed against your retainer.
Will I Receive a Refund if There is a Remaining Balance in my Retainer?
If there is a remaining balance in your retainer, the possibility of receiving a refund depends on the type of matter for which the attorney was retained.
In hourly matters, you are entitled to receive a refund if there is any remaining balance in your retainer. However, the attorney’s ability to resolve your matter within the time allotted is subject to several factors, such as the amount and nature of the content and the platform on which it was posted.
On the other hand, refunds are not available for MFAs since they are earned when the client signs the agreement.
If you are considering reaching out to Minc Law, please see our comprehensive guides explaining why open and consistent communication is essential to assisting you with your case and the types of matters that qualify for a free consult.
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At Minc Law, we aim to be as transparent as possible about our pricing and billing processes so that you can make an educated decision about hiring legal representation. Our goal is to make finding the right attorney for your matter as painless as possible.
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