Attorneys generally charge their clients in one of three ways: (1) an agreed hourly rate, times the number of hours the attorney spends on the matter; (2) a contingent fee, in which the attorney receives a percentage of the amount recovered or received by the client in the matter; or (3) a fixed-fee in which the attorney charges an agreed amount (often with some or all of the fee paid before work begins). If the attorney is charging on an hourly basis, he may require a fee deposit (sometimes called a retainer) to secure payment of the hourly fees. The client may be required to replenish this fee deposit. The attorney must hold the unearned fee deposit in her trust account until she does the work and is entitled to some or all of the payment.
In Alabama, attorneys typically charge clients using one of three fee structures: hourly rates, contingent fees, or fixed fees. An hourly rate is calculated by multiplying the agreed-upon hourly fee by the number of hours the attorney works on the client's case. A contingent fee arrangement involves the attorney receiving a predetermined percentage of the client's recovery or settlement. Fixed fees are set amounts agreed upon before the attorney begins work, and these fees may be required to be paid upfront. When an attorney charges by the hour, they may ask for a fee deposit, also known as a retainer, to ensure payment for their services. Clients might be asked to replenish this deposit over time. It is important for the attorney to keep any unearned fee deposits in a trust account and only withdraw from it once the corresponding work has been performed and they are entitled to the payment. These practices are subject to the rules of professional conduct and other relevant laws governing the practice of law in Alabama.