Also known as: retaining fees · retainer fee · retainer
Written by attorneys · grounded in primary & secondary sources — see below
A fee paid by a client to an attorney in advance to secure the attorney's availability for future legal services. Payment of the fee typically creates an attorney-client relationship that triggers duties of competence, loyalty, and confidentiality even before specific work begins.
Rhea Reynolds met with an attorney for an initial consultation about a potential claim. The attorney evaluated the facts and gave advice but never requested or received a retaining fee. When the attorney failed to follow up, the statute of limitations expired. Rhea later sued for malpractice, and the court held that an attorney-client relationship and duty of care had arisen despite the absence of any retaining fee.
Ronald Reed joined a civil rights organization that paid a retaining fee to staff attorneys. The organization used the fee to secure representation for members challenging segregation policies. Reed relied on the attorneys' availability when deciding to participate in the suit. The court examined whether the retaining fee arrangement created protected attorney-client relationships for the individual members.
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Regal Apparel paid a retaining fee to an accounting firm for audit services. The firm later argued the fee did not extend duties to third-party investors who relied on the audit. Investors sued for negligence after discovering misstatements. The court analyzed whether the retaining fee created privity or a relationship sufficient to impose liability beyond the paying client.
Raphael Rivera paid a retaining fee to a securities lawyer under a broad engagement letter. The lawyer later claimed the fee covered only regulatory advice and not document drafting. Rivera had already announced the lawyer would handle all offering materials. The dispute centered on whether the retaining fee manifested assent to the full scope of services.
Rosa Ruiz saw an attorney's advertisement offering a retaining fee for limited-scope representation. She paid the fee and signed a letter restricting the engagement to one matter. Later Ruiz sought advice on additional issues. The court reviewed whether the retaining fee and signed limitation validly confined the attorney's duties.
Robert Rivera paid a retaining fee to counsel in a criminal matter. The same lawyer had previously represented a co-defendant in a related case. Rivera moved to disqualify counsel, arguing the prior retaining fee created an ongoing duty. The court considered whether the fee established a current attorney-client relationship that triggered conflict rules.
Payment of a retaining fee typically manifests the client's intent to secure the lawyer's services and supports formation of the relationship. Courts also recognize that a relationship and attendant duties can arise even without a formal retainer or fee when the lawyer gives advice and the client reasonably relies on it.
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Absence of payment after a draft engagement letter may prevent formation of an enforceable agreement if the parties understood payment as a condition. An affirmative reply to the letter alone may still manifest mutual assent in some circumstances, but nonpayment and subsequent denial often indicate no completed bargain.
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A retaining fee combined with a signed retainer letter that expressly limits scope can create a valid limited representation if the limitation is reasonable and the client gives informed consent. Later conduct that blurs the scope may undermine the limitation even when the fee was paid.
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…or any other source, any other compensation for his services in an NAACP-assisted case. None of the staff receives a salary or retainer from the NAACP; the per diem fee is paid only for professional services in a particular case. This per diem payment is smaller than the compensation ordinarily received for equivalent…