Divorce Mediation Blog

What's In a Retainer? A Cautionary Tale

Wednesday, March 05, 2014

We were recently surprised by a client's statement she thought that a retainer is non-refundable. Our response was easy. The Massachusetts rules that govern the practice of law make clear that non-refundable retainer is an oxymoron. Retainers are advance payments that may be used to fund future services, with any unused portion refunded to the client. Isn't this something that lawyers have known for decades? Maybe not.

Lawyers Weekly recently reported that an attorney represented a criminal defendant and lost big when the client sued for what he alleged was an over charging: $120,000.00 for a case that resulted in a continuance without a finding. While the lawyer tried to characterize his initial $40,000.00 fee as part of the larger "flat fee", the judge whose jury found in favor of the client, re-branded the payment as a non-refundable retainer. The result: a $90,000.00 finding of unreasonable fee, tripled for consumer protection violation, and inflated to nearly a half million dollars, with accrued interest.

What was he thinking? The fundamentals of a retainer are long-known. While this already suspended lawyer may not be a reasonable measure of normal, we have to wonder how many lawyers engage in unethical billing practices because they do not know better? Even worse, are there some who do it purposefully because of the long odds of being caught?

There is nothing wrong with a retainer. If properly explained, it provides client commitment, a certain level of security and cash flow reliability in a field where "what have you done for me lately?" is a common lament. We use small retainers to fund work that occurs outside of our divorce mediation sessions, such as session summaries and agreement drafting. We explain how they work to clients up-front, and no one has yet declined.

The recent case tells us that all we need to be even better at explaining our retainer practices. For firms in which large retainers are the norm, this need is magnified. In divorce and family law, all new clients share some level of vulnerability, and many are prone to re-interpret their relationship with counsel when the need for services abates, especially if the results have been disappointing (as they often are). Ethics and fairness aside, our reputations and ability to earn a living depend on it.

Get e-mail notifications of new blog posts! Enter email address below.:

Delivered by FeedBurner

other articles

recent posts


divorce agreement high-risk methodology LDRC Uniform Arbitration Act self-adjusting alimony Baseball Players Massachusetts divorce lawyers divorce and family law disputes support orders divorce arbitrator resolve disputes mediator alimony statute family law lawyers divorce litigation family law arbitrator Baseball Arbitration medical benefits Defense of Marriage Act alimony IRC §2704 COLA med/arb arbitrators divorced Same Sex Marriage Levine Dispute Resolutions med-arb Chouteau Levine child support health insurance fraud Act Reforming Alimony in the Commonwealth family law arbitrators divorce arbitration The Seven Sins of Alimony mediation Divorce Massachusetts divorce mediators Family Law Arbitration rehabilitative alimony divorce arbitrators divorce mediator how baseball arbitration works Massachusetts lawyers family mediation family and probate law disputes arbitration divorce mediation Levine Dispute Resolution Center separation Massachusetts Alimony Reform Act lawyer-attended mediation Self-adjusting alimony orders Child Support Guidelines family law mediation divorce lawyers Massachusetts private dispute resolution lawyer alimony law divorce and family law mediators alimony orders Alimony Reform Act divorce judgment arbitrator MLB labor agreement family support Massachusetts alimony and child support Massachusetts alimony Divorce Agreements Baseball DOMA Cohabitation special master mediations alimony reform legislation annulment pre-ARA alimony Levine Dispute Resolution Center LLC traditional negotiations divorce mediators health coverage Obamacare Matrimonial Arbitration SJC divorce mediations Massachusetts Lawyers Weekly Boston Levine Dispute Resolution facilitated negotiations mediators General term alimony Major League Baseball Arbitration divorce process dispute resolution litigation conciliation