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Understanding Legal Fees and Costs

Several fees and costs are involved when enlisting the aid of an attorney. 

Fees

Legal fees charged by your attorney vary according to the amount of time spent on your case, the attorney's experience, the difficulty of the case, the results, and the costs involved. Get everything in writing. Fee disputes are the most common type of problem encountered between attorneys and clients. Common fee arrangements include: 

Consultation fee: The meeting where both you and the attorney determine whether he or she can assist you may be free of charge, although many attorneys charge a fixed or hourly fee.

Contingency fees: The attorney charges a percentage (generally one–third) of the amount awarded in the case. If you lose the case, the attorney does not get a fee, but you will still have to pay expenses. Generally used in personal injury cases, property damage cases, or other cases where a large amount of money is involved. Contingency fees are typically not available if you are seeking general legal advice such as the purchase or sale of a business.

Flat fees:
 Your attorney's services are covered in one comprehensive fee. A flat fee is usually offered only for simple or routine cases such as a will or an uncontested divorce.

Hourly rate:
 Charges are based on each hour (or portion thereof) that the attorney works on your case. This is the most typical fee arrangement. If the attorney charges by the hour, you should find out the minimum billing segment (e.g. one–quarter or one–tenth of an hour).

Retainer fees:
 Think of this as a down payment. You pay a set fee, often based on the attorney's hourly rate, which is placed in a special account. The cost of services is deducted from that account. Many retainer fees are non–refundable unless a court rules the fee unreasonable.

Statutory fee:
 The fees in some cases may be set by statute or a court may set and approve a fee that you pay. These types of fees may appear in probate, bankruptcy, or other proceedings.

Costs

Charges for legal services almost always include additional costs outside of the attorney's fees. You can tell your attorney that any costs over a certain amount have to be approved by you in advance; you might be able to negotiate the amount charged for many of these costs. These costs include:

  • Filing fees and court costs
  • Photocopying
  • Deposition and court reporter costs
  • Paralegal time
  • Computer or research related costs
  • Secretarial and staff time
  • Messengers
  • Telephone and postage charges
  • Facsimiles (faxes)
  • Experts, consultants, and witness fees
  • Investigators
  • Process servers (delivery of legal documents relating to case)
  • Travel expenses

Reducing your legal expenses

Regulating fees and costs by forging a written agreement between you and your attorney is just the beginning. Throughout your dealings you should carefully organize all your information, and present facts clearly and concisely. This not only makes more efficient usage of your attorney's time, but your checkbook. Also, carefully monitor your bill. Make sure expenses have not surpassed pre–agreed limits.


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