Attorney Engagement Letter Template (Free Sample)

What is an engagement letter?

An engagement letter (also called a letter of engagement, retainer agreement or fee agreement) is a letter or short contract from a law firm to a client, usually countersigned by the client, that records the terms of the representation. It identifies the client, describes the scope of the work and what is excluded, states the basis of the fee and the expenses the client will pay, explains any advance deposit and how it is held, and covers communications, conflicts, file retention, termination and fee disputes.

It protects both sides. The client knows what they are paying for and what is not included. The lawyer has a written record of the agreed scope and fee, which matters when a fee dispute, a malpractice claim or a question about who the firm represented comes up later. Accountants, consultants and other professionals also use engagement letters; this page covers engagement letters for lawyers in the United States.

Engagement letter vs retainer agreement vs non-engagement letter

• Engagement letter. Usually a letter from the firm setting out the terms, with a signature line for the client to accept them.
• Retainer agreement or fee agreement. Often the same document in contract form, signed by both lawyer and client. Some states use these terms for specific situations, such as contingency fee agreements or agreements a statute requires in writing.
• Non-engagement letter. A short letter confirming that the firm has not agreed to represent someone (for example after an initial consultation), so the person does not assume the firm is protecting their interests or watching a deadline. It typically suggests that they consult other counsel promptly about any deadlines.
• Disengagement (closing) letter. A letter confirming that the matter is finished and the representation has ended, which also clarifies that the firm has no continuing duty to advise on later developments.

Is a written engagement letter required?

ABA Model Rule 1.5

Under ABA Model Rule of Professional Conduct 1.5(b), the scope of the representation and the basis or rate of the fee and expenses for which the client will be responsible must be communicated to the client, preferably in writing, before or within a reasonable time after the representation starts. The rule does not require this when the lawyer will charge a regularly represented client on the same basis or rate. Any change in the basis or rate of the fee or expenses must also be communicated to the client.

Contingent fees are stricter. Model Rule 1.5(c) requires a contingent fee agreement to be in a writing signed by the client. It must state how the fee is determined, including the percentage or percentages that go to the lawyer if the matter settles, goes to trial or is appealed; the litigation and other expenses to be deducted from the recovery; and whether those expenses are deducted before or after the contingent fee is calculated. It must also clearly tell the client about any expenses the client must pay whether or not the client wins. At the end of the matter, the lawyer must give the client a written statement of the outcome and, if there is a recovery, how the remittance to the client was calculated. Model Rule 1.5(d) prohibits contingent fees in criminal defense and in certain domestic relations matters.

Every state has its own version of Rule 1.5, and several go further than the Model Rule, for example by requiring fee terms in writing for new clients. Check your state's version.

New York: 22 NYCRR Part 1215

In New York, 22 NYCRR Part 1215 generally requires an attorney to give the client a written letter of engagement before the representation starts, or within a reasonable time after it starts if a letter beforehand is impracticable or the scope of services cannot yet be determined. The letter must explain the scope of the legal services; the attorney's fees, expenses and billing practices; and, where applicable, that the client may have a right to arbitrate fee disputes under 22 NYCRR Part 137. A signed written retainer agreement that covers the same points can be used instead. If the scope of services or the fee changes significantly, an updated letter is required.

Part 1215 does not apply where the fee is expected to be less than $3,000; where the services are of the same general kind as services previously rendered to and paid for by the client; to domestic relations matters covered by 22 NYCRR Part 1400, which has its own written retainer requirements; or where the attorney is admitted in another jurisdiction and has no New York office, or no material portion of the services is to be rendered in New York.

California: Business and Professions Code 6147 and 6148

California requires written fee agreements by statute. Under Business and Professions Code section 6148, where it is reasonably foreseeable that the total expense to the client, including attorney fees, will exceed $1,000, the fee agreement must be in writing (unless it is a contingency fee agreement, which section 6147 covers), and the attorney must give the client a fully executed copy when the agreement is made. The agreement must state the basis of compensation (such as hourly rates, statutory fees or flat fees, and other standard rates, fees and charges), the general nature of the legal services, and the respective responsibilities of the attorney and the client. Section 6148 has exceptions for urgent work needed to prevent foreseeable harm to the client's rights or interests, or circumstances making a writing impractical; an implied fee arrangement based on similar work previously performed for and paid for by that client; a client's knowing written waiver of a fee writing after full disclosure of the section; and corporate clients.

Section 6147 requires a contingency fee contract to be in writing, with a duplicate copy signed by both the attorney and the client (or the client's guardian or representative) given to the client when the contract is made. It must state the contingency fee rate; how disbursements and costs will affect the fee and the client's recovery; to what extent the client could have to pay for related matters the contract does not cover; and, unless section 6146 applies, that the fee is not set by law and is negotiable. For a claim covered by section 6146, the contract must instead explain that its fee limits are ceilings and that the parties can agree to a lower fee. If a contract does not comply with section 6147 or 6148, it is voidable at the client's option, and the attorney is then entitled to collect a reasonable fee.

California Rule of Professional Conduct 1.4.2 separately requires a lawyer who does not have professional liability insurance to tell the client so in writing at the time of the engagement, subject to the rule's exceptions.

What an engagement letter must cover

• Who the client is. Name the client exactly. For a company, say whether the firm also represents its owners, officers, employees, parent or affiliates (usually it does not). For a couple, family or group, say whether the firm represents each of them, and how information will be shared among them.
• Scope of the representation. Describe the matter and the work the firm will do. Under Model Rule 1.2(c), a lawyer may limit the scope of a representation if the limitation is reasonable in the circumstances and the client gives informed consent.
• Exclusions. List what is not included, such as litigation, appeals, tax advice, insurance coverage, advice on the laws of other jurisdictions, or monitoring changes in law after the matter ends. Exclusions prevent arguments later that the firm took on a task it never agreed to.
• Fees. The basis of the fee: hourly rates for each timekeeper and the billing increment, a flat fee, a contingent fee (with the signed-writing rules above), or a mix. Say when rates may change and how the client will be told. Under Model Rule 1.5(a), any fee must be reasonable.
• Expenses. Which costs the client pays (filing fees, experts, court reporters, local counsel, travel) and whether some will be billed directly to the client.
• Retainer or advance deposit and the trust account. How much is paid up front, whether it is an advance against fees, and where it is held. Model Rule 1.15(c) requires fees and expenses paid in advance to be deposited into a client trust account and withdrawn only as fees are earned or expenses incurred. Model Rule 1.16(d) requires a lawyer to refund any advance payment of a fee or expense that has not been earned or incurred when the representation ends. Many states restrict "nonrefundable" retainers and flat fees, so calling a fee nonrefundable does not make it so; check your state's rules.
• Billing and payment. How often the firm invoices, what the invoice shows, when payment is due, and what happens if invoices go unpaid.
• Client responsibilities. Providing complete and accurate information, responding and making decisions in time, keeping the firm told of developments, preserving relevant documents, and paying invoices.
• Conflicts of interest. Confirm that the firm ran a conflicts check and on which names. If a conflict needs the client's consent, Model Rule 1.7(b) requires informed consent, confirmed in writing; handle that consent specifically, not through boilerplate.
• Communications and confidentiality. How the firm will keep the client informed (Model Rule 1.4 requires reasonable communication), which channels it uses, and any agreed precautions for sensitive information. ABA Formal Opinion 477R (2017) discusses securing electronic communications that contain client information. If the firm uses generative AI tools, ABA Formal Opinion 512 (July 2024) says that where client informed consent is needed to input confidential information into a tool, general boilerplate in an engagement letter is not enough.
• File retention. What happens to the client's file when the matter ends, how long the firm keeps it, and how it may be destroyed. Model Rule 1.15(a) separately requires records of trust account funds and other client property to be preserved for five years after the representation ends (the period in brackets in the Model Rule; many states set their own).
• Termination and withdrawal. The client can end the representation at any time. The lawyer may withdraw only as Model Rule 1.16 permits or requires, for example if the client fails substantially to pay after reasonable warning, and must get the court's permission where the tribunal's rules require it. On termination the lawyer must take reasonable steps to protect the client's interests, including returning papers and property the client is entitled to and refunding unearned fees.
• End of the engagement. When the matter ends (for example on the final invoice), so it is clear the firm has no continuing duty to advise.
• Dispute resolution. How fee disputes are raised and resolved, and any state fee arbitration notice. ABA Formal Opinion 02-425 says a lawyer may include a binding arbitration clause covering fee disputes and malpractice claims if the client is fully informed of its advantages and disadvantages and the clause does not limit the lawyer's liability; some states impose more conditions. Model Rule 1.8(h)(1) prohibits an agreement prospectively limiting the lawyer's liability to the client for malpractice unless the client is independently represented in making it.

Free attorney engagement letter template (sample text)

Copy the text below into Word and fill in the brackets. It is an original, general US sample for an hourly matter with an advance deposit, not tied to any state. It is a starting point, not a finished document: adapt it to your state's rules of professional conduct and statutes, your firm's policies and the matter. It does not cover contingent fees, which need a separate written agreement signed by the client with the terms your state requires.

Sample: law firm engagement letter (hourly matter, fill-in template)

Copy engagement letter text

Not legal or ethics advice. This sample is not tailored to any state, practice area or matter. Check your state's rules of professional conduct, fee and trust account rules, required notices and ethics opinions before you send it, and use a separate signed agreement for any contingent fee.

Common mistakes in engagement letters

• A vague scope. "Represent the client in the deal" invites a later claim that the firm was responsible for tax, regulatory or litigation issues it never looked at. Say what is included and what is not.
• Not naming the client. In company and family matters, the hardest dispute is often who the firm represented. Name the client and say who is not a client.
• Treating an advance as earned. An advance deposit usually belongs in the trust account until it is earned. Depositing it in the operating account, or labeling it "nonrefundable" without a basis in your state's rules, is a common source of discipline.
• Using the same letter for a contingent fee. Contingent fees need a writing signed by the client with specific terms, and some states add their own content and form rules.
• No update when the work changes. If the scope or fee changes significantly, confirm it in writing (New York requires an updated letter in that case).
• Boilerplate consents. Conflict waivers and consent to sharing confidential information with AI tools need informed consent, which general boilerplate may not provide.
• No end date. Without a clear end of the engagement, the client may assume the firm is still watching deadlines and changes in law.

How to draft or review an engagement letter in Word with LexDraft

LexDraft is a Word add-in from Microsoft AppSource. It opens as a side panel in Word 365 (Windows and Mac), Word 2021 and Word on the web, so the engagement letter stays in the document you are already editing.

What LexDraft does not do: it does not give legal or ethics advice, run conflict checks, manage trust accounting or billing, or confirm that a letter meets your state's current rules. You check every output against your state's rules before it goes to a client.

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