Do I have a case against a law firm?
Here it is, I was considering filing for bankruptcy and found a firm online that offered a free initial consultation. Half way through my initial consultation I was asked to pay a $500 down payment for a retainer fee for this firm to file bankruptcy papers for me. The phone call lasted about 1 hour. After hanging up I read some info that the bk attorney emailed me and decided that I was not ready to file for bankruptcy. I called the firm back asking for a refund as I had changed my mind, it was less than an hour since I hung up from my initial consultation, so I didn’t really expect it to be a problem. The attorney told me they would not give me a refund & if I tried to stop payment they would sue. Well, I hung up, called my bank and stopped payment and now 2 weeks later they are calling me and threatening “legal action”. My question is should I really have to pay them? They didn’t do anything other than the initial consult which was supposed to be free.
I live in California and I did not sign anything. I was not even sent anything to sign. The reason I say he did not do anything is because I did not sign anything that would allow him to start paperwork on my behalf. And as he did not set up any future appointments with me I fail to see how he could have turned down any other clients due to my “retainer”
Rob5279,
I’m curious why you think I’m in the wrong. Doesn’t a customer have the right to change their mind? Especially within a 24 hour period?
June 29th, 2009 at 3:30 am
Did you sign anything?
July 2nd, 2009 at 1:59 pm
I am not sure what state you are in but usually nonrefundable retainers must be written and signed by the client. The retainer agreement must inform clients that they may not receive a refund of such retainer fees if they later choose not to hire or to terminate the lawyer’s services and lawyers should understand that the reasonable fee requirements may obligate them to refund some portion of an availability or nonrefundable fee under certain circumstances. For example, the client could change his or her mind shortly after paying the lawyer a nonrefundable or an availability retainer. If the lawyer has not already performed services on the client’s behalf and has not already declined other representation, a refund would likely be required in order for the fee to be reasonable. This is the position recently taken by the New York City Bar Association Ethics Committee in Formal Opinion 1991-3 (determination of ethically appropriate fee cannot be made definitively at outset of representation even in nonrefundable retainer cases). Fees paid pursuant to an availability or nonrefundable retainer are not required to be deposited into a trust account nor do they need to be held in trust. The amount of a nonrefundable or availability retainer must be reasonable.
I would mention that to these people in a certified letter. You may want to check out what laws your particular state has regarding retainer fees so you can quote the statute directly.
July 4th, 2009 at 12:33 am
1. Did you sign anything?
2. How do you know they didn’t do anything? They could have already started preparing the paperwork for the bankruptcy in the hour before you changed your mind.
July 4th, 2009 at 5:02 am
Let them sue you.
You are in the wrong based on the those facts, but I would let them take their legal action. There’s a good chance they won’t go to court. Tell them to bring it on. Then, if necessary, go to the small claims court and explain your story. It’s easy. It’s not a criminal matter; its a legitimate dispute over $500 that is probably not worth their time.