Fee Agreements - What Applies In New York and Indiana

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Divorce Saloon published Retainer agreements and your divorce: A primer. Some applies directly to Indiana,

In New York and most other if not all other states in the Union, a retainer agreement in matrimonial actions is a requirement. Failure to execute one and provide a client with a Statement of Clients Rights and Responsibilities could preclude an attorney from getting paid one dime in the divorce action. It is a very serious infraction. As a matter of fact, here in New York, an attorney is required to file the retainer agreement with the court along with the client’s statement of Net Worth at the very beginning of the case, so that the court can assess whether or not the attorney’s fees and terms comply with state law and mandates.

It doesn’t matter if the divorce is contested or uncontested. An attorney is required to have a retainer agreement for ANY matrimonial action that he or she handles because guess what? A lot of uncontested divorces, so called uncontested divorces, actually turn out to be contested. And the attorney is required to have the terms of such an eventuality spelled out for the client at the beginning of the case or risk not getting paid if the thing turns ugly.

Okay, New York is a whole lot tougher than Indiana. Our fee agreements are definitely not filed with the court (which makes me wonder if the New York fee agreements are then open to the public - and therefore other lawyers. Indiana lawyers really have no idea what everyone else is charging until and unless we ask the court for payment of fees by the other side.)

Indiana's Rule of Professional Conduct 1.5 applies to our fee agreements. The main parts dealing with family law matters are these:

(b) The scope of the representation and the basis or rate of the fee and expenses for which the client will be responsible shall be communicated to the client, preferably in writing, before or within a reasonable time after commencing the representation, except when the lawyer will charge a regularly represented client on the same basis or rate. Any changes in the basis or rate of the fee or expenses shall also be communicated to the client.

(c) A fee may be contingent on the outcome of the matter for which the service is rendered, except in a matter in which a contingent fee is prohibited by paragraph (d) or other law. A contingent fee agreement shall be in a writing signed by the client and shall state the method by which the fee is to be determined, including the percentage or percentages that shall accrue to the lawyer in the event of settlement, trial or appeal; litigation and other expenses to be deducted from the recovery; and whether such expenses are to be deducted before or after the contingent fee is calculated. The agreement must clearly notify the client of any expenses for which the client will be liable whether or not the client is the prevailing party. Upon conclusion of a contingent fee matter, the lawyer shall provide the client with a written statement stating the outcome of the matter and, if there is a recovery, showing the remittance to the client and the method of its determination.

(d) A lawyer shall not enter into an arrangement for, charge, or collect:

(1) any fee in a domestic relations matter, the payment or amount of which is contingent upon the securing of a dissolution or upon the amount of maintenance, support, or property settlement, or obtaining custody of a child; or

(2) a contingent fee for representing a defendant in a criminal case.

This provision does not preclude a contract for a contingent fee for legal representation in a domestic relations post-judgment collection action, provided the attorney clearly advises his or her client in writing of the alternative measures available for the collection of such debt and, in all other particulars, complies with Prof.Cond.R. 1.5(c).

Back to Divorce Saloon's article, and its listing of what should be in the fee agreement:

1. Names and addresses of the attorney and client.

2. The hourly fee/rate

3. Amount of any advance retainer and what it covers.

4. Whether the agreement covers appeals, family court proceedings or any other proceedings in addition to the divorce action.

5. the right of the client to fire the attorney at any time or to seek other counsel at any time.

6. Whether the attorney would require an additional retainer for trial or not.

7. Frequency of itemized billing.

8.under what circumstances the lawyer may seek to withdraw from the case and the attorney’s right to seek a charging lien.

9. Client’s right to be kept abreast of the case and receive correspondences if requested.

10. all other pertinent terms and conditions.

Frankly, I would think 1 -7 would not need much explaining to the general public. Everybody wants to know what will be the cost and what they are paying for. Eight and Nine, I spell out in my fee contracts because most clients doe not seem to understand that lawyers are supposed to communicate with them (see Indiana's Rule of Professional Conduct 1.4) or that we can withdraw from a case (see Indiana's Rule of Professional Conduct 1.16). But I got to say that I am not sure what comes under the heading of "ll other pertinent terms and conditions," and it probably does leave the general public scratching their heads.

So far, I have published on Scribed my fee agreement for visitation cases, child support cases, and for uncontested divorces. Between sick kids, work and an attack of bronchitis, I have not finished with revising all of my fee agreements. Keep checking my documents at Scribd as that is where I will be posting them.