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Expert Witness Retainer Practices

Recently while being interviewed for a case by an attorney, after discussing the basic issue involved the attorney naturally asked about my fee structure. I outlined my fees in detail, and informed her that I hold the retainer until the end of the engagement and apply it to the last invoice I generate for the case and/or any unpaid invoices. However, the retainer is nonrefundable if I work on the case less than 10 hours.

I explained that the “nonrefundable” retainer is my minimum case fee, that is, it is based on 10 hours of work. If I work less than 10 hours and I am informed the case is settled or closed for any reason and my services are no longer required the retainer is considered earned and will not be refunded. (Based on my experience and attorney feedback, 10 hours is a fair and reasonable retainer.)

I invoice for all hours starting with the first hour I work on the case and invoice every 25 calendar days. All invoices are payable within 15 days of receipt of my invoice. At the conclusion of the case, assuming I have worked more than the 10-hour minimum, I credit the retainer payment against the last invoice I generate for the case and/or any unpaid invoices. Should the retainer value exceed the last and/or unpaid invoices’ value, I refund any balance due. For example, if the retainer payment was hypothetically $4,000 and the value of my last invoice or unpaid invoices was $3,000, I would credit the $3,000 and refund $1,000. So in essence the retainer becomes an escrow fund.

The attorney appeared puzzled and said she had never heard of that before. She asked if I would look over some of the discovery in the case, and then discuss the case with her in more detail, and just invoice for the time spent without any retainer payment or signed retainer agreement. I politely but clearly told her I would not perform any work without a retainer agreement and accompanying retainer payment. She then indicated she would get back to me, which does not seem likely.

It is essential that experts obtain an initial retainer payment and signed retainer agreement clearly outlining the terms and conditions of the commitment, to establish the business relationship between the expert and the attorney.

The retainer agreement also acknowledges good faith on the part of both the attorney and the expert. The attorney accepts some risk at the beginning of the case as he or she is partially pre-paying for my work. I subsequently accept risk in the case as I will be doing work for which I have not yet been paid, which may at times exceed the value of the retainer I am holding.

Some experts use “evergreen” retainers.” “Evergreen” means that the retainer payment renews automatically. Each month that the payment is made it is extended another month unless terminated; a retainer amount is not held to be credited against the last invoice. Replenishing or “evergreen” retainers can lead to problems. Trying to always stay ahead of the workload in terms of pre-payment before any work is done by the expert is difficult and may create a feeling of distrust.

Regardless of which form of retainer is used, experts should never perform work without a signed retainer agreement and retainer payment. Those who do, do so at their peril.

Disclaimer: While every effort has been made to ensure the accuracy of this publication, it is not intended to provide legal advice as individual situations will differ and should be discussed with an expert and/or lawyer.For specific technical or legal advice on the information provided and related topics, please contact the author.

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