NJ: attorney client retainer agreement
Facts: In the attorney-client retainer agreement the firm (defendants) stated that billing would be on an hourly basis, what hours would be considered as billable, and the range of billable rates for the attorneys in the firm. The agreement further provided that details on any of the items and the policies will be provided upon request and that whether or not they are requested the client will be bound by the standard billing practices and policies. The details were to be found in the attorney’s Master Retainer. The plaintiffs later requested the master retainer when handling issues and billing issues arose. The master retainer included details such as the client would be paying twelve percent interest on late charges, collection fees, all fees for the attorneys to withdraw from the representation as well as secretarial overtime. Plaintiffs alleged that their bill contained unfair billing entries.
(1) Is an Affidavit of Merit required?
(2) Is the attorney’s "Master Retainer" agreement enforceable?
(1) Yes. An Affidavit of Merit is required in a billing dispute to show deviation from the standard of care.
(2) No. R.PC. 1.5(b) requires that an attorney who has not regularly represented a client present in writing, at the time of retention, all of the fees and costs that the client will be charged for as well as the terms and conditions upon which the fees and costs will be imposed. Absent such complete detailed written disclosure presented to and agreed to by the client the attorney consistent with R.P.C. 1.5(b) may not collect such fees. By inviting the client to seek out the Master Retainer the attorney shifted his fiduciary duty to the client and undermined the intent and purpose of R.P.C. 1.5(b). In New Jersey two or more writings may constitute a single contract even though they do not refer to each other. In order for there to be a proper and enforceable incorporation by reference to a separate document the incorporated document must be described in such a way that its identity is certain and the party to be bound by the terms must have had knowledge of and agreed to the incorporated terms. Here the retainer did not sufficiently define the Master Retainer. The retainer agreement did not ensure that practices and policies were ascertained beyond doubt. Also, there is no indication that the terms of the proposed incorporated document were known or assented to by the client. A contract is unenforceable when contrary to public policy. Here the Master Retainer agreement violates public policy because they were not disclosed in writing and given and explained to the client at the time of retention.
Lesson: An attorney retainer agreement is not enforceable unless client has knowledge of and has agreed to the terms of the agreement.
Tagged with: 1.4(c), 1.5(b), 7.1(a), Affidavit, agreement", attorney's fees, contract, counsel, duty, enforceability, ethical, fiduciary, from, Jersey, Merit, motion, New, New Jersey, pleading, policy, pro, public, R.P.C.:, retainer, rules:, se, supplemental, withdraw