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Could mistakes with your retainer constitute legal malpractice?

On Behalf of | Oct 11, 2022 | Legal Malpractice

Lawyers often demand thousands of dollars as a retainer for their services. Whether you need to hire the best family law attorney or a litigation specialist to represent your business in a product defect lawsuit, you must pay up front for a significant portion of the lawyer’s work.

The funds that you provide should go into a special escrow account. Your lawyer will then advise you in detailed billing statements of when and why they make claims against your retainer. Sometimes, lawyers do not follow the proper procedures for the management of retainers.

Could those errors lead to a claim of legal malpractice?

Retainer mistakes are surprisingly common

You would think that lawyers with an education in legal code and the interpretation of court rulings would understand how important compliance with the rules for client funds would be.

However, major mistakes with clients’ retainers are among the top causes of malpractice claims. Clients with certain records from their relationship with their attorney or a total lack of key records may have grounds for a malpractice claim.

What kinds of mistakes with your retainer are actionable?

One of the most common actionable errors with a retainer is the intentional inflation of claims against it. An attorney who does not need to commit as many hours as they thought to a case may round up significantly when billing against a retainer.

They might charge for 30 minutes of time when they responded to an email and only spent two or three minutes doing so. You should receive an accurate and reasonable breakdown of all the services that diminished your retainer.

On the other hand, they may have failed to place your retainer into a separate escrow account as is typically necessary. They may have commingled it with their business funds by depositing it in the firm’s checking account. They could also misappropriate your retainer and use it for personal or business purposes without ever rendering enough legal service to you to justify charging you that amount.

When you believe that your lawyer mismanaged your retainer and charged you an inappropriate amount of money, you can potentially take action against them. Learning more about the rules that govern retainers, attorney-client relationships and legal malpractice claims can help you decide what step to take next.

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