For some legal services, a flat fee is charged for the entire process. Sometimes these fees are due before any work is done on your behalf. For document preparation by my office, one half of such fees are collected at the initial interview, and the other half is collected at the time the document is complete.

For some other legal services, time spent by attorneys, paralegals and law clerks is charged by the tenth of an hour. In many cases, retainer funds are requested in advance to be held in escrow and disbursed as attorney fees and expenses accrue. These funds may not cover the entire case, and additional deposits to the retainer will be requested if necessary. If any funds are remaining when the case is finished, they will be refunded.

Finally, some legal services are performed on a contingent basis. The client is usually responsible for the payment of all expenses of the case regardless of the outcome, and the attorney is not paid unless a settlement or judgment is collected. Sometimes an attorney will request funds to be held in escrow for an expense retainer. An attorney will usually charge between a quarter (25%) and a third (33-1/3%) for legal fees in a case accepted on contingency. Any expenses advanced by the attorney will be deducted from the clients' portion of the settlement or judgment proceeds.

Mediation services are charged by the hour, and the charge is payable before each mediation session for the time to be spent in mediation that day. The parties to the mediation may decide how to divide this amount.

As stated above, when hourly fees are charged for legal services or an expense retainer is deemed necessary, retainer funds may be requested in advance to be held in escrow for future use. If the amount is very large or the funds are to be held for a long period of time without periodic withdrawals, the funds may be placed in an account earning interest for the client's benefit. However, if the amount is smaller or the time is short, it is impractical to establish separate interest-bearing accounts for individual clients. In this event, there is a legal requirement to place such funds into a commingled clients' escrow account that generates interest income. This interest is sent by the financial institution to the Maryland Legal Services Corporation for grants to programs which provide civil legal services to the poor.

You should inquire in what financial institution your attorney will hold your escrowed funds. If you have other funds on deposit at the same financial institution, any unearned retainer funds held by your attorney may count toward your aggregate limit for purposes of FDIC Deposit Insurance Coverage. I do not provide legal advice on this subject, therefore, if this is of concern to you, I advise you to seek further guidance from the bank or an attorney who practices in this area to determine any action you may need to take.

If you have questions about the above information, please call me, and I will gladly answer your questions and explain the fee structures in more detail. Agreements regarding the appropriate fee arrangement for your case will be discussed at our initial meeting, after the particular facts and circumstances involved have been presented.