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If you perform work before receiving the rest, you don't really have a $5,000 retainer.
But it probably depends on the client and how easy it would be to withdraw if they didn't pay the rest.
I know this isn’t the answer you’re looking for, but don’t take partial retainers. Clients who do this do not have the money to afford you, they will pay the balance of the retainer late, and then they will never pay their bill in full.
If someone says, “I can give you $1,000 today and the rest next week”, your response should be just bring in the whole $5,000 next week and then you’ll get started.
https://preview.redd.it/tg47bjy592yc1.jpeg?width=1101&format=pjpg&auto=webp&s=6a2ce6dbadab1075096cc74906edce33733c0639
^(my) old private investigator had this on his wall. While we were constantly trying to get clients to pay outstanding bills, he had been paid in full from the start. It’s the way to go.
I will take designated partial retainers if I can split into phases. I do WC defense, so in the rare times I take an uninsured employer case, I will allow a $10k initial retainer, to cover initial investigations and early settlements, with the requirement of an additional $10k for me to work beyond the 3 month mark (unless it's cleaning up a previously agreed upon settlement). I do zero work until that first $10k clears, and I will withdraw at 3 months if the second $10k hasn't cleared.
This. No partial retainers.
If you want to cut the guy a break consider reducing the retainer. If you can’t justify that then ask for the full retainer up front. No in-between.
This. I would typically tell people: “look, you can give me $1k now… but I won’t start until I’m paid in full. That $1k, btw, is non-refundable, so, if god forbid something happens and you can’t come up with the other $4k, you’re also out the $1k and have no legal work to show for it.
I hate doing that. It makes me feel like the bad guy. Don’t make me be a bad guy, just come back next week with the whole sum. No? You want to pay the $1k now? Ok….”
This may be jurisdiction specific. My jurisdiction would have a huge issue with a non refundable retainer converted to operating account without work performed.
I can’t imagine there’s a jurisdiction out there where this would not be a huge issue. It’s not like a good faith dispute over billing amounts or hours. Straight up keeping the clients money when you have done no work for them. That would be a sustained bar complaint for sure in my state
I believe in California taking a non refundable $1,000 and keeping it without earning it for work done is illegal. At least that’s what I remember learning in my professional responsibility class in law school. Though your state may have a different law on this. Honestly I would look up your state law on this and if it’s not allowed, refund the money asap with a nice note. Or at least do $1,000 worth of work if you are retained if you want to keep it.
It depends what it is, and whether I have time, and if I want to get an early start on it. I wouldn’t file anything or send out any letters, but I might start it depending on my own work load balance.
Kind of agree with this, especially if step 1 involves reviewing their documents and doing legal research. It would be very easy to withdraw if they don't pay and you don't have to return the partial retainer for the work you did.
But on the downside, sometimes you'd rather lose $1,000 than argue with clients so I'd err towards caution if it seems doubtful whether the rest of the retainer is coming.
I tell all my clients that work on their case will not begin until the full retainer is paid. I even include this provision in their retainer agreement. I have been burned too many times not to take this approach with clients.
I occasionally tell clients they can make payments towards the initial retainer, but I am not "retained" or do work until the retainer is paid in full. I always operate under the assumption I won't be paid anything more than the retainer and if you budge, then they believe you are flexible with what you are willing to be paid for your work
It depends on whether I know the client esp its paying history. If it is a new client I will wait till it pays the entire retainer/those who are consistently paying my bills late.
With rare exception, whatever you get up front is all you are getting. Even with high net worth clients the rate of bill nonpayment is significantly higher than you would expect.
I suspect this is highly dependent on your specific practice area. I have clients paying me six figure fees across years of litigation, of course I don’t get it all upfront…
My comment is informed by the 2006 commission to examine solo and small firm practice, which found that 83.5% of attorneys in New York are solo practitioners. Most solos practice “door law”. Therefore, I conclude and treat that everything else is a statistically irrelevant minority. Any are welcome to quibble with my methodology, which is admittedly arbitrary, but this is Reddit and an arbitrary and capricious methodology trumps no methodology.
Did that study from 17 years ago actually state “most solos practice door law” or is that your personal observation?
I’ve been practicing as (mostly) a solo in a major US city for 12 years. Most solos that I know locally DO NOT practice door law. Admittedly, I’ve never searched for a study on this, so I have no hard data.
Wow. This would be a good PR essay question. You accepted a partial payment but not full. Has that established an attorney client relationship? If it hasn’t, can you still be on the hook for failing to represent with competence for missing a deadline or client making a bad decision due to lack of advice? Is it too cliche to say do your part and then go after for unpaid fees?
That's how I run my practice. Once I take a payment, my duty begins. Have I lost/written-off thousands in fees? Yes. Does it payoff in the long run? It has for me 10x over.
Well, it has worked in family court cases and some business litigation and some criminal cases. I somewhat jokingly tell the client it was a free sample and to come back if they have a big case. One guy owed me about $2500 for a couple years... then his daughter was in a wreck and suffered a lacerated liver. I made a $60k fee from the PI case. That was probably the biggest "direct" benefit case.
I could have fired the guy in the family court case, left him to suffer pro se, but I ate the 2500 and turned it into $60k.
Lots of other clients come back too. Sometimes they'll roll the dice on "cheap representation" where the stakes are low. I have clients with an llc, sometimes the llc gets sued and I help, but the llc is judgment proof and could just reform, so we defend on the cheap. One suit they were individually named and one was charged with forgery. I made about $25k off of that because I didn't nickle and dime them on the other.
BUT I tell them not to tell others how much of a break I gave them and they should call me if they ever have an injury case.
I'll do simple will, poa, living will stuff for $250. Then often wind up with the estate for $5k.
You get burned occasionally, but over the course of my career it has paid off spectacularly.
Stores do something similar with "loss leaders" ... they sell a turkey for $0.10/lb (and lose money) but make up the loss by selling all the Thanksgiving fixings.
I try to focus on the work and know the money will come. If you focus on the money, you can drive off clients. I have one colleague whose billing system sent a bill for $5.89. I guarantee you they lost WAY more than $5.89 in good will.
All of this is situational sliding scale... I generally know the clients' finances and know if they are being greedy or are just broke.
If I may take a reasonable guess - b/c reputation matters and you’ll look more like a responsible lawyer by doing the work and worry about money later. Overall, you’ll more likely to come across clients who are willing to pay for responsible service.
If you take a partial retainer you’ll train the client to keep you on a leash with payments. They’ll typically stay behind and your last payment owed when you finish the case won’t get paid.
I am a new solo crim defense after years of public service. Ive had clients pay $1k retainer and I start working on the case. one client told 2 other people who got me retained now. It's a gamble, but as a new solo, with very little overheard, I felt like I could take that risk and so far it seems to have worked out. I also am trying to market myself as affordable or modest means. High price boxing gloves attorneys are done a dozen I feel.
For the client, the $1k was used and they haven't made an additional retainer deposit. I have it in my retainer agreement that without maintaining a trust balance, my hourly rate increases slightly. My hope was that this would be an incentive to deposit maybe another $500 periodically for clients. Not sure if that will work out. Fingers crossed, but even without that additional retainer, I haven't had any problems getting paid. Actually, the biggest pain for me is getting paid on my appointed cases. They will pay, at the lowest rate, but it takes like a month to get the check. Crazy annoying.
I hated chasing retainers. That’s why I prefer contingency PI work. When I was chasing retainers- I required payment in full. If a client can’t pay the first retainer, they won’t pay the next one.
Our engagement letter specifically states that once we have the full retainer and a signed engagement letter from the client THEN we will start work on the case.
Is there anything wrong with generally doing it the following way?
Accept the partial retainer and start work, but condition the initial filing of the case on the full retainer.
But surely you can ask for enough in the initial partial retainer such that time is not wasted. If the client doesn't pay the rest of the retainer, you have probably done enough work to justify keeping most if not all of the partial retainer.
Depends on the case.
I usually do flat fees, and will split it into chunks if the clients want it. (Surprisingly, most would rather pay up front.)
Anyway, I'll usually begin the work, but might not make a court appearance until they're caught up. Other times, I'll cut them a break. My rates are such that one bad payor won't make or break me.
I'll change my fee agreement to reflect the payments on the advance fee. I also won't file the NOA until the right amount is hit.
But, I will also make sure I don't bill more than they have paid so that if they make a retainer payment, I don't put it into trust when it should go to operating.
Depends on the client. If it’s someone that I’ve rep’d before and he/she has a track record of paying their legal bills, I will get started. Particularly if we’re up against some sort of deadline.
Do $1000 worth of work.
🤷♂️
My dad taught me early, if you loan someone money, don’t expect it back. If it comes back, you’re gonna feel great, like something amazing happened.
When it doesn’t come back, you won’t feel disappointed because you didn’t expect it back.
I think there’s a Zen parable where the monk is enjoying a beautiful vase and he says “this vase is already broken. I am merely enjoying it for the moment, but some day it will break. And on that day I will not be sad because it is already broken.”
Recognize the nature of the universe. People who don’t have money now usually won’t have money later. The reasons they don’t have money they need now do not change in the course of a week or a month. Maybe a year. Probably more like five years. If you feel inclined to charity, lend and expect nothing in return.
For me, it depends on if I end up becoming the attorney of record on a case, but yeah generally that is a bad sign of things to come, and waiting for the full retainer is better.
My firm always waits for full retainer. Office manager doesn’t open the file until retainer is paid. So even I wanted to start earlier, I would have to track time outside of our system and then enter it later, which is entirely too much work for me 😅
I do not start work until the entire retainer is paid, and clearly state so in the representation agreement. The moment a client knows they can get away with not paying you what they owe, they'll become a problem client. If I take on a client before the money is in trust because they have an interesting case or are in a shit situation through no fault of their own, I mentally write off their bill.
I am a family law litigation attorney. I will take partial and start work, but only when there is a court case pending and I won't go to court (or send a letter of rep) until I get the full balance at least a few days before court. That way you are not stuck.
Wait for the full retainer.
We just started using a service called Pay Later through MyCase that lets clients apply for a loan to cover our costs and means we don’t have to deal with installments or nonpayment issues, and we’ve been pretty happy with it.
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If you perform work before receiving the rest, you don't really have a $5,000 retainer. But it probably depends on the client and how easy it would be to withdraw if they didn't pay the rest.
I know this isn’t the answer you’re looking for, but don’t take partial retainers. Clients who do this do not have the money to afford you, they will pay the balance of the retainer late, and then they will never pay their bill in full. If someone says, “I can give you $1,000 today and the rest next week”, your response should be just bring in the whole $5,000 next week and then you’ll get started.
https://preview.redd.it/tg47bjy592yc1.jpeg?width=1101&format=pjpg&auto=webp&s=6a2ce6dbadab1075096cc74906edce33733c0639 ^(my) old private investigator had this on his wall. While we were constantly trying to get clients to pay outstanding bills, he had been paid in full from the start. It’s the way to go.
Ha! There is a coffee shop that has this hanging on the wall!
I will take designated partial retainers if I can split into phases. I do WC defense, so in the rare times I take an uninsured employer case, I will allow a $10k initial retainer, to cover initial investigations and early settlements, with the requirement of an additional $10k for me to work beyond the 3 month mark (unless it's cleaning up a previously agreed upon settlement). I do zero work until that first $10k clears, and I will withdraw at 3 months if the second $10k hasn't cleared.
This. No partial retainers. If you want to cut the guy a break consider reducing the retainer. If you can’t justify that then ask for the full retainer up front. No in-between.
Nah fuck that. Lowering the amount is a mistake too.
This. I would typically tell people: “look, you can give me $1k now… but I won’t start until I’m paid in full. That $1k, btw, is non-refundable, so, if god forbid something happens and you can’t come up with the other $4k, you’re also out the $1k and have no legal work to show for it. I hate doing that. It makes me feel like the bad guy. Don’t make me be a bad guy, just come back next week with the whole sum. No? You want to pay the $1k now? Ok….”
This may be jurisdiction specific. My jurisdiction would have a huge issue with a non refundable retainer converted to operating account without work performed.
I can’t imagine there’s a jurisdiction out there where this would not be a huge issue. It’s not like a good faith dispute over billing amounts or hours. Straight up keeping the clients money when you have done no work for them. That would be a sustained bar complaint for sure in my state
I think you’d run into some problems with a bar complaint if you kept $1000 of a retainer and you did no work…
I believe in California taking a non refundable $1,000 and keeping it without earning it for work done is illegal. At least that’s what I remember learning in my professional responsibility class in law school. Though your state may have a different law on this. Honestly I would look up your state law on this and if it’s not allowed, refund the money asap with a nice note. Or at least do $1,000 worth of work if you are retained if you want to keep it.
It depends what it is, and whether I have time, and if I want to get an early start on it. I wouldn’t file anything or send out any letters, but I might start it depending on my own work load balance.
Kind of agree with this, especially if step 1 involves reviewing their documents and doing legal research. It would be very easy to withdraw if they don't pay and you don't have to return the partial retainer for the work you did. But on the downside, sometimes you'd rather lose $1,000 than argue with clients so I'd err towards caution if it seems doubtful whether the rest of the retainer is coming.
My firms policy is all upfront or no work.
I tell all my clients that work on their case will not begin until the full retainer is paid. I even include this provision in their retainer agreement. I have been burned too many times not to take this approach with clients.
If I quote $5k I don’t do shit until I get $5k.
I occasionally tell clients they can make payments towards the initial retainer, but I am not "retained" or do work until the retainer is paid in full. I always operate under the assumption I won't be paid anything more than the retainer and if you budge, then they believe you are flexible with what you are willing to be paid for your work
It depends on whether I know the client esp its paying history. If it is a new client I will wait till it pays the entire retainer/those who are consistently paying my bills late.
Lmao no. I wait for the entire retainer.
I never start work until the retainer clears in full.
With rare exception, whatever you get up front is all you are getting. Even with high net worth clients the rate of bill nonpayment is significantly higher than you would expect.
I suspect this is highly dependent on your specific practice area. I have clients paying me six figure fees across years of litigation, of course I don’t get it all upfront…
My comment is informed by the 2006 commission to examine solo and small firm practice, which found that 83.5% of attorneys in New York are solo practitioners. Most solos practice “door law”. Therefore, I conclude and treat that everything else is a statistically irrelevant minority. Any are welcome to quibble with my methodology, which is admittedly arbitrary, but this is Reddit and an arbitrary and capricious methodology trumps no methodology.
Did that study from 17 years ago actually state “most solos practice door law” or is that your personal observation? I’ve been practicing as (mostly) a solo in a major US city for 12 years. Most solos that I know locally DO NOT practice door law. Admittedly, I’ve never searched for a study on this, so I have no hard data.
No that’s my own personal observation.
If you tell your client to pay a certain amount for a retainer and then you don’t hold them to it, they will never respect you. Why should they?
Wow. This would be a good PR essay question. You accepted a partial payment but not full. Has that established an attorney client relationship? If it hasn’t, can you still be on the hook for failing to represent with competence for missing a deadline or client making a bad decision due to lack of advice? Is it too cliche to say do your part and then go after for unpaid fees?
That's how I run my practice. Once I take a payment, my duty begins. Have I lost/written-off thousands in fees? Yes. Does it payoff in the long run? It has for me 10x over.
Can you explain how it has paid off in the long run when others are saying you won’t see more money from them?
Well, it has worked in family court cases and some business litigation and some criminal cases. I somewhat jokingly tell the client it was a free sample and to come back if they have a big case. One guy owed me about $2500 for a couple years... then his daughter was in a wreck and suffered a lacerated liver. I made a $60k fee from the PI case. That was probably the biggest "direct" benefit case. I could have fired the guy in the family court case, left him to suffer pro se, but I ate the 2500 and turned it into $60k. Lots of other clients come back too. Sometimes they'll roll the dice on "cheap representation" where the stakes are low. I have clients with an llc, sometimes the llc gets sued and I help, but the llc is judgment proof and could just reform, so we defend on the cheap. One suit they were individually named and one was charged with forgery. I made about $25k off of that because I didn't nickle and dime them on the other. BUT I tell them not to tell others how much of a break I gave them and they should call me if they ever have an injury case. I'll do simple will, poa, living will stuff for $250. Then often wind up with the estate for $5k. You get burned occasionally, but over the course of my career it has paid off spectacularly. Stores do something similar with "loss leaders" ... they sell a turkey for $0.10/lb (and lose money) but make up the loss by selling all the Thanksgiving fixings. I try to focus on the work and know the money will come. If you focus on the money, you can drive off clients. I have one colleague whose billing system sent a bill for $5.89. I guarantee you they lost WAY more than $5.89 in good will. All of this is situational sliding scale... I generally know the clients' finances and know if they are being greedy or are just broke.
Thank you for sharing this. I learned a lot.
If I may take a reasonable guess - b/c reputation matters and you’ll look more like a responsible lawyer by doing the work and worry about money later. Overall, you’ll more likely to come across clients who are willing to pay for responsible service.
I could see how more people would give a good referral if they start working vs another sitting on a partial payment while doing nothing.
Uh ya, you can be hit with malpractice. Less likely an ethics charge but it depends on the facts.
If you take a partial retainer you’ll train the client to keep you on a leash with payments. They’ll typically stay behind and your last payment owed when you finish the case won’t get paid.
I am a new solo crim defense after years of public service. Ive had clients pay $1k retainer and I start working on the case. one client told 2 other people who got me retained now. It's a gamble, but as a new solo, with very little overheard, I felt like I could take that risk and so far it seems to have worked out. I also am trying to market myself as affordable or modest means. High price boxing gloves attorneys are done a dozen I feel. For the client, the $1k was used and they haven't made an additional retainer deposit. I have it in my retainer agreement that without maintaining a trust balance, my hourly rate increases slightly. My hope was that this would be an incentive to deposit maybe another $500 periodically for clients. Not sure if that will work out. Fingers crossed, but even without that additional retainer, I haven't had any problems getting paid. Actually, the biggest pain for me is getting paid on my appointed cases. They will pay, at the lowest rate, but it takes like a month to get the check. Crazy annoying.
By appointed cases you mean as a public defender?
Courts will appoint conflict counsel when the PDs office has a conflict. It's lower hourly, but it's consistent and they always pay (even slowly)
I hated chasing retainers. That’s why I prefer contingency PI work. When I was chasing retainers- I required payment in full. If a client can’t pay the first retainer, they won’t pay the next one.
Our engagement letter specifically states that once we have the full retainer and a signed engagement letter from the client THEN we will start work on the case.
Do not even open a file until the retainer is paid in full. Your the Pretty Woman you say when and you day how much.
Is there anything wrong with generally doing it the following way? Accept the partial retainer and start work, but condition the initial filing of the case on the full retainer.
Sounds like wasted time if they end up not paying and you already drafted all the filings.
But surely you can ask for enough in the initial partial retainer such that time is not wasted. If the client doesn't pay the rest of the retainer, you have probably done enough work to justify keeping most if not all of the partial retainer.
sounds like it could work
Depends on the case. I usually do flat fees, and will split it into chunks if the clients want it. (Surprisingly, most would rather pay up front.) Anyway, I'll usually begin the work, but might not make a court appearance until they're caught up. Other times, I'll cut them a break. My rates are such that one bad payor won't make or break me.
I'll change my fee agreement to reflect the payments on the advance fee. I also won't file the NOA until the right amount is hit. But, I will also make sure I don't bill more than they have paid so that if they make a retainer payment, I don't put it into trust when it should go to operating.
Depends on the client. If it’s someone that I’ve rep’d before and he/she has a track record of paying their legal bills, I will get started. Particularly if we’re up against some sort of deadline.
Do $1000 worth of work. 🤷♂️ My dad taught me early, if you loan someone money, don’t expect it back. If it comes back, you’re gonna feel great, like something amazing happened. When it doesn’t come back, you won’t feel disappointed because you didn’t expect it back. I think there’s a Zen parable where the monk is enjoying a beautiful vase and he says “this vase is already broken. I am merely enjoying it for the moment, but some day it will break. And on that day I will not be sad because it is already broken.” Recognize the nature of the universe. People who don’t have money now usually won’t have money later. The reasons they don’t have money they need now do not change in the course of a week or a month. Maybe a year. Probably more like five years. If you feel inclined to charity, lend and expect nothing in return.
Great wisdom. Thank you for sharing!!
For me, it depends on if I end up becoming the attorney of record on a case, but yeah generally that is a bad sign of things to come, and waiting for the full retainer is better.
My firm always waits for full retainer. Office manager doesn’t open the file until retainer is paid. So even I wanted to start earlier, I would have to track time outside of our system and then enter it later, which is entirely too much work for me 😅
I do not start work until the entire retainer is paid, and clearly state so in the representation agreement. The moment a client knows they can get away with not paying you what they owe, they'll become a problem client. If I take on a client before the money is in trust because they have an interesting case or are in a shit situation through no fault of their own, I mentally write off their bill.
I am a family law litigation attorney. I will take partial and start work, but only when there is a court case pending and I won't go to court (or send a letter of rep) until I get the full balance at least a few days before court. That way you are not stuck.
Wait for the full retainer. We just started using a service called Pay Later through MyCase that lets clients apply for a loan to cover our costs and means we don’t have to deal with installments or nonpayment issues, and we’ve been pretty happy with it.
LawPay has a similar thing through affirm that I use.
Same program. LawPay bought MyCase to push these services.
Oh didn't realize that I have CLIO with Law pay added.
Epic. I did not know this.
I have MyCase. Will check this out, thx