Lawyer Retainer Agreements

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Particularly if you’ve never hired a lawyer before, it can be an unfamiliar and anxiety-causing process. The parents of a child with a birth injury will of course want to do right by their child, and will understandably want to avoid making mistakes in the process.

At the initial lawyer meeting, there will be some documents that require reading and signature.  The most important of these, of course, is the retainer agreement—the contract between you and the law firm.  This document outlines the lawyers’ duties to you, and your duties to the law firm.  It allows the lawyers to begin representing you and your child, and to immediately begin work on your case.  Our goal is to demystify the retainer agreement, so that you can better understand what it says and what it means.

There is no standard form for a retainer agreement—every law firm does them a little differently, and the provisions vary widely by case type.  A retainer agreement for a bankruptcy case is very unlike a retainer agreement for a personal injury case.

A Written Agreement

The most important quality of a retainer agreement is that it should be written and signed by a representative of the law firm, as well as each adult who is represented.  If a client is under a legal disability, for example, a minor (under the age of 18) or an adult with a significant intellectual disability, a guardian must sign on the client’s behalf.  If the case is one for wrongful death, the personal representative of the estate, and oftentimes all legal beneficiaries (typically children, parents, and sometimes other relatives), must sign the document (the specific requirements vary by state).

It is never advisable to hire a lawyer with only a verbal agreement.  A written agreement offers protections to the client, and is proof-positive that there is a lawyer-client relationship.  The agreement should briefly state the nature of the representation. It is sufficient to state that the agreement is for injuries regarding suspected medical negligence occurring on or about the date of the child’s birth.  At the conclusion of your meeting, you should request a signed copy of the retainer agreement for your files.  We recommend that all of our clients keep a folder or binder with all documents we send them.

Legal Fees

One of the provisions in the contract will be for legal fees.  The majority of birth injury lawsuits use a contingency fee.  Other types of cases, like criminal defense or family law, rely on flat fees or hourly billing.  For plaintiff personal injury lawsuits like birth injury cases, the contingency fee permits regular people to hire a lawyer to take on large hospitals, insurance companies and doctors.

Under the contingency fee system, the lawyer does not get paid hourly and does not receive any payments directly from the client.  Instead, the lawyer only gets paid at the end of the case if there is a recovery.  The lawyer will not get paid unless the case settles or gets a plaintiffs’ verdict at trial.  If the case is lost at trial, the lawyer will not get paid.

The exact nature of the fee structure can vary slightly by lawyer and by type of case, but the majority of birth injury lawyers do it the same way:  the lawyers get one-third (33.33%) of the total recovery if the case settles before a lawsuit is filed in court; the lawyers get 40% of the total recovery if the case settles after a lawsuit is filed, or if a plaintiff’s verdict is achieved at trial.   Many lawyers have been increasing their fee to 50% of the recovery, but we believe that is too high.

The difference in fee between a pre-filing settlement and a post-filing recovery is based on the amount of work that goes into a case.  There is an extraordinary amount of time and effort that goes into preparing a case to be filed, and taking it to trial:  intense meetings with treating physicians and experts, legal research, assisting with expert reports, drafting the complaint, writing and responding to motions, performing discovery, attending depositions, and finally trial (which typically lasts between two and four weeks in a birth injury case).

If the client is being represented by multiple law firms, the retainer agreement (or some other document) should state how each firm is to get paid.  In our retainer agreements there is no extra charge to the client for a case with multiple law firms—the law firms will share any attorneys’ fees by a pre-arranged agreement.  Other law firms may be useful, for example, when local counsel from another state is necessary.

Case Expenses

The legal expenses of a birth injury case include anything that costs money.  This is not for the lawyers’ time, which is paid for through the contingency fee.  Examples of case expenses include:

  • Mailings, postage and delivery costs
  • Copies and printouts
  • Costs of medical records
  • Mileage and transportation costs (to court, expert meetings, etc…)
  • Exhibits (electronic and physical)
  • Medical and other expert fees
  • Deposition and court reporting costs
  • Court fees

The most important part of a contingency fee agreement from a client’s perspective is the provision on payment of expenses.  The client should ensure that the contract has some provision to the effect that if the case is lost, the client will not have to pay back any of the lawyers’ case expenses.  We strongly believe that the risk of a birth injury malpractice lawsuit should be taken by the law firm.

A Practical Example of Fees & Expenses

First the disclaimer:  every case is different, and no attorney can guarantee the results of any case.  These numbers are an example of how a case that is taken to verdict might be calculated.

Verdict Amount

$4,500,000.00

Attorneys’ Fees (40%)

$1,800,000.00

Case Expenses

  • Medical Records:  $1,500.00
  • Expert Services:  $99,500.00
  • Deposition Services:  $8,500.00
  • Copies, Postage, Mileage, etc.:  $11,000.00

$120,500.00

Medical Assistance Lien

$38,000.00

Total Client Recovery

$2,541,500.00

 

In most birth injury cases, there will be outstanding medical expenses held by Medicare, medical assistance (Medicaid), individual doctors or hospitals, or private health insurance liens.  Those medical expenses will typically need to be paid back, and one important service that lawyers provide is the negotiation of the final amounts.  In many cases, they can preserve more money for the client by reducing the amount owed for medical expenses.

Contact Us

If you would like to set up a meeting with our medical malpractice lawyers to see if you have a potential case, call us at (855) 712-7818 or send us an online communication.  You can request a sample copy of our retainer agreement before the meeting so that you’ll have time to read it and ask questions when you see us.

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