Of Attorney Flat Fees and the Minnesota Rules.

When considering hiring an attorney, it is important for the prospective client to understand what is expected before signing that engagement agreement. How a practitioner is compensated depends on a number of factors, including the nature of their practice, the complexity of the case, and so forth. Attorney fees are governed by Rule 1.5 of the Minnesota Rules of Professional Conduct.

One common means of attorney compensation is the hourly fee. The practitioner charges an hourly rate for time spent providing legal services to the client, and may also bill separate hourly rates for services of other professionals (such as paralegals, expert witnesses, etc.) who are needed in furtherance of the case. There may be different hourly rates for different services. In addition, there may be fixed expenses that are billed to the client, such as filing fees, court costs, incurred expenses, etc.

The practitioner may bill the client periodically along the way by invoice, or they may require that a certain sum be paid up-front: a retainer. The retainer funds are immediately deposited into a client trust account (CTA), or an IOLTA account. Those funds cannot be "commingled" (mixed) with any other funds. The practitioner bills against the retainer. If the case becomes more complex, and the agreement provides for additional funding, the practitioner may require the client to pay more into the retainer account. Conversely, if there are funds remaining in the retainer account when the matter has been completed, the practitioner must refund that unused amount to the client.

In the world of estate representation, practitioners engaged in probate administration--the process of closing a deceased person's estate through the probate process--typically bill hourly, and those rates depend on the complexity of the case, size of the estate, experience of the attorney, etc.

Another form is the contingency fee--the "you don't pay unless we win" method. This is frequently used by practitioners representing plaintiffs pursuing damages in tort cases, such as personal injury. If the plaintiff prevails at trial and receives a jury award, or if the opposing party agrees to pay a settlement, the plaintiff attorney collects a pre-agreed-upon percentage of the award or settlement, plus any other fees or expenses as set forth in the retainer agreement.

However, those of us who practice in the area of crafting estate-planning documents (myself included), tend to charge flat fees for legal services. As the name implies, a flat fee is simply an agreed-upon, fixed dollar figure to be paid by the client for the performance of certain legal services, such as drafting a will or power of attorney. Estate-planning attorneys typically require half or all of the flat fee in advance before starting the representation.

After having consulted with the client, the practitioner will give a quote for the services requested by the client. If the practitioner and client agree to representation, the client will be asked to sign an engagement agreement. Before the client signs, it is very important for them to thoroughly read and understand what is expected in the engagement agreement. The attorney has an obligation to explain this up-front; nevertheless, it is incumbent upon the prospective client to ask questions if there is any doubt.

There are some specific rules about flat fees, and the Minnesota Rules set those out.

Fee agreements cannot claim any fee to be non-refundable, or earned upon receipt. Naturally, it would be unfair for a practitioner to collect a fee and keep it if, for some reason, either party doesn't go ahead with the representation.

However, the agreement may claim the fee as an advance fee as the attorney's property--subject to refund.

In order for the attorney to charge a flat fee as an advance fee subject to refund, the attorney must notify the client in writing of five things:

1. The nature and scope of services provided;

2. the total amount of the fee and terms of payment;

3. that the fee will not be held in a trust account until earned;

4. that the client has the right to terminate the attorney-client relationship; and

5. that the client will be entitled to a refund of all or a portion of the fee if the agreed-upon legal services are not provided.

Here's how it works.

Example: An attorney requires the client to pay a $1000 fee in advance for her legal services drafting some documents. The attorney cannot claim that any of the $1000 fee is non-refundable, nor can she claim any of it as property of her or her firm. Makes sense, right? She hasn't earned the fee yet. However, the attorney can state that the $1000 is an advance fee payment, subject to refund. In other words, if either the attorney or her client chooses to end the representation, for whatever reason, the attorney is obligated to refund the client's advance fee--minus whatever portion of the advance fee the attorney has earned up to that point by her representation. If, in this example, the attorney had rendered some legal services in furtherance of the client's case, like doing research or drafting documents, she would be well within her right to keep a portion of the advance fee for those services. If the client disputes this, the attorney must take reasonable and prompt action to resolve the dispute.

When selecting an attorney to provide representation, it is important for the client to be fully informed before entering in an engagement agreement. A thoughtful attorney will state what will happen going forward, and should fill in all the blanks. But a wise client will ask for clarifications, if needed.

Less Than 100 Days Until The General Election.

With everything going on right now, participating in the 2020 election is more crucial than ever. If you haven't registered to vote (or you're not sure if you are registered), you can get more information from the Minnesota Secretary of State's website. Rock The Vote also has good information about voter registration and deadlines.

Requirements are that a person be a U.S. citizen who is at least 18 years old on Election Day, a resident of Minnesota for at least 20 days, and has completed all parts of any felony conviction. If a person is 17 years old now, but will turn 18 by Election Day, they can pre-register now--no need to wait until after their birthday to register. Persons under a guardianship can vote unless a judge has specifically revoked that person's right to vote or a court has ruled the person legally incompetent.

You can register on paper, or online. Voting by mail-in absentee ballot is very straightforward and, importantly, you do not need to give a reason to vote absentee. The ballot comes with a post-paid return envelope. The deadline for absentee voting: the ballot must be postmarked on or before Election Day. 

Here's more information on absentee voting in Minnesota.

The Minnesota Primary is coming up fast, on August 11, and absentee voting is open. The deadline for voter registration for the primary has passed, on July 21, but it's not too late to register to vote for the general election.

Some CLEs That May Be Of Interest To Estate-Planning Practitioners.

In addition to some of the upcoming Estate-Planning CLEs, such as the live, online Understanding Trusts seminar on July 28, and the big 2020 Probate & Trust Law Section Conference (live, online) on October 16 and 17, there are also a few web-based seminars that touch on subjects surrounding our practice area, and may be worth considering. Also, if you report this summer, the State Board has waived the 15-hour limit for on-demand CLE credit, so have at it.

I have listed a few that may be good for rounding out one's knowledge base, or as refreshers for those who practice in those areas. 

The following seminars are free for Mitchell Hamline alumni.  

Basics of Divorce Law for Non-Family-Law Attorneys is a 1-credit on-demand seminar that can bring in some basic knowledge of several important topics in an area that more than occasionally bumps into Estate-Planning practice.

Another good one we could take to heart is Seven Deadly Sins of Drafting from Forms (1-credit). Many of us--myself included--rely heavily on standard forms from which to build our work product. I use Minnesota CLE's venerable Drafting Wills and Trust Agreements Deskbook. But no deskbook or form can anticipate all potential situations. This is a seminar I plan to watch soon, as I need to pick up on any pitfalls I may be missing.

Other free on-demand seminars that may be interesting and helpful include Issues Under the "New" Minnesota LLC Act (1-credit), and Veterans Issues- Obstacles for Those Who Served (1-credit).

U of M:

If you need Elimination of Bias credits, the University of Minnesota Law School is offering The Minnesota Paradox: A Discussion About Racial Disparities in the Criminal Justice System (1-credit, free), on Wed. July 29, 2020. This seminar is an interactive panel discussion you can log onto via Zoom.

Delta Calls Bluff Of People Who Try To Skirt Mask Rules.

Since May, Delta Airlines has required all passengers to wear face masks while on board their aircraft, and many other airlines have instituted similar policies. The reasons for these policies are obvious, and I won't belabor that point. But naturally, there are always a few entitled people who try to dodge the rules under the guise of the ADA or some cry for "personal freedom" in an effort to make an end run around the policy, and we hear about them on the news.

Delta Airlines has recently augmented its mask policy for passengers, now requiring anyone who objects to wearing one to demonstrate a valid reason.  

Can't wear a mask, you say? No problem, just complete Delta's Clearance-To-Fly process before you board and we'll be hunky-dory. 

The CtF process involves a Delta agent requiring the passenger to talk to a third-party medical professional and getting approval before the passenger is allowed to board. This process weeds out the people making bogus assertions and protects the rights of those who genuinely have protections under the ADA.

Delta goes one step further by recommending that, if wearing a mask really does pose a health hazard to you, then perhaps you should seriously reconsider flying in the first place.

If you show up at the airport and flash one of those fake mask exemption cards (replete with typos and citing some non-existent agency), then perhaps you haven't thought your cunning plan all the way through.

UPDATE: American Airlines and Southwest Airlines both announced that they will no longer allow any exceptions to their mask mandate, except for children 2 and under.