What is a Retainer-Cost Agreement?

Apr 21, 2016
Reading Time: 2 minutes
Written by Dominic Woolrych

A retainer is simply an agreement, it is evidenced through writing, verbally or concluded by the conduct of the parties to the relationship. A retainer is essentially an agreement between you and your lawyer setting out the services that will be performed as well as the estimated costs involved.

How is a Retainer Created?

In order for a retainer to exist, there must be some kind of consideration. That is, a price that is offered in exchange for the lawyer’s services. Further, a retainer must have been created with the intention that you and the lawyer will enter into a legally binding relationship. In doing so the retainer must adhere to the statutory formalities such as those set out in the Legal Professions Act 2004.

For instance, the issue of how and when a client first instructs a law practice is considered under s306. Here, it establishes that it is when the law practice receives instructions from the client. In addition, to these requirements it must be acknowledged that the client must have the ability to enter into the retainer for it to be valid. Finally, the lawyer must have the full consent of the client to enter into the contract.

What are the Lawyer’s Duties Under a Retainer?

The duties under a retainer are the following:

  • Confidentiality of your information
  • The duty to the court and the proper administration of justice
    • Lawyers are not to advise or allow you to act in a manner that would be in breach of the law or mislead the court
      Avoid potential and/or conflicts of interest
  • Comply with statutory and regulatory requirements as to costs and maintaining a professional relationship and sufficient objectivity to ensure that you are afforded proper advice

Unsure about Confidentiality Agreements? You can create your Confidentiality Agreement for Free at Lawpath.

When can retainers be terminated?

The Solicitors Rules in particular rule 13, sets out circumstances in which retainers may be terminated:
Lawyers must ensure completion of the legal services unless:

  • You otherwise agreed
  • The law practice is discharged
  • The law practice terminates the engagement for just cause and on reasonable notice; or
  • The engagement comes to an end by operation of law

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