Fee Agreement and Engagement Letter Starter
This free form builds an editable engagement letter for a new client. Choose how you charge (by the hour, a flat fee or a contingency fee), describe the work, and fill in the fee, the costs the client pays, how you bill and how either side can end the engagement. The letter is written around what ABA Model Rule 1.5 asks a lawyer to communicate: the scope of the representation and the basis or rate of the fee and expenses, preferably in writing (Rule 1.5(b)); and, for a contingency fee, a writing signed by the client that states how the fee is figured, the percentages at settlement, trial or appeal, which expenses come out of the recovery, and whether they come out before or after the fee is figured (Rule 1.5(c)).
The result is a starting point, not a finished agreement: each state adopts its own version of the rule and adds its own requirements (some require every fee agreement in writing, some regulate flat fees and retainers, some have required words), so have the letter reviewed for your state's rules before you send it. Nothing you type leaves your browser.
Not legal advice; verify with your court's rules. A starting point: have it reviewed for your state's rules. It does not claim to satisfy any state's rule, and it leaves the places your state decides marked for you to write.
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Edit it here or in your own word processor. The first line asks for a review for your state; delete it when that is done.
What Rule 1.5 asks for, and where the letter covers it
What ABA Model Rule 1.5 asks a fee agreement to say
The ABA Model Rules of Professional Conduct are the model most states start from; each state adopts its own version, so the text below is the model, not your state's rule. Read on the American Bar Association's site on October 15, 2026 (Rule 1.5: Fees, the page dated April 14, 2020).
Every fee agreement: scope, basis or rate, expenses, changes (Rule 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 shall be communicated to the client, preferably in writing, before or within a reasonable time after commencing the representation, except when the lawyer will charge a regularly represented client on the same basis or rate. Any changes in the basis or rate of the fee or expenses shall also be communicated to the client."
ABA Model Rule 1.5(b)
So the letter names the matter and the work (the scope), says how the fee is figured (the hourly rate, the flat fee or the percentages), says which expenses the client pays, and promises that any change to the basis or rate will be communicated. The rule says preferably in writing
; a letter the client signs settles what was agreed, and several states require the writing.
A contingency fee: in writing, signed, with the method and the expense rules (Rule 1.5(c))
"A contingent fee agreement shall be in a writing signed by the client and shall state the method by which the fee is to be determined, including the percentage or percentages that shall accrue to the lawyer in the event of settlement, trial or appeal; litigation and other expenses to be deducted from the recovery; and whether such expenses are to be deducted before or after the contingent fee is calculated. The agreement must clearly notify the client of any expenses for which the client will be liable whether or not the client is the prevailing party. Upon conclusion of a contingent fee matter, the lawyer shall provide the client with a written statement stating the outcome of the matter and, if there is a recovery, showing the remittance to the client and the method of its determination."
ABA Model Rule 1.5(c)
So a contingency letter states the percentage at each stage (settlement before suit, after suit, at trial or on appeal), lists the expenses that come out of the recovery, says whether they come out before or after the fee is figured, says plainly whether the client pays expenses if there is no recovery, and promises the closing statement. The client signs it.
The fee must be reasonable (Rule 1.5(a)) and some contingency fees are forbidden (Rule 1.5(d))
A lawyer shall not make an agreement for, charge, or collect an unreasonable fee or an unreasonable amount for expenses.
The rule lists eight factors, from the time and skill required to the fee customarily charged in the locality and whether the fee is fixed or contingent. And a lawyer shall not charge any fee in a domestic relations matter, the payment or amount of which is contingent upon the securing of a divorce or upon the amount of alimony or support, or property settlement in lieu thereof
, or a contingent fee for representing a defendant in a criminal case
.
What the letter leaves for you and your state
- Your state's version of Rule 1.5. States differ on whether every fee agreement must be in writing, on flat fees and advance payments (what may be called earned on receipt, what must sit in trust, what is refundable), on required disclosures, and on caps for some contingency fees. The letter marks those places with [[double brackets]] for you to write.
- Trust accounting. An advance deposit is written as held in a client trust account and applied as fees and costs are earned and billed. Your state's trust account rules decide the details.
- Withdrawal. The letter says you may withdraw as the rules of professional conduct allow and with the court's permission where needed (ABA Model Rule 1.16 and your state's version of it); it does not list the grounds.
- Nothing else is implied. No arbitration clause, no fee-dispute program language, no file-retention period and no statement about malpractice insurance is included; some states require one or more of those. Add what your state requires.
Questions lawyers ask
What must a fee agreement include under ABA Model Rule 1.5?
Rule 1.5(b) asks the lawyer to communicate the scope of the representation and the basis or rate of the fee and the expenses the client will pay, preferably in writing, before or within a reasonable time after the representation begins, and to communicate any later change in the basis or rate. The fee itself must be reasonable under Rule 1.5(a). Your state's version of the rule may ask for more.
Does a fee agreement have to be in writing?
Under the ABA model, a writing is preferred, not required, except for a contingency fee, which must be in a writing signed by the client (Rule 1.5(c)). Several states require every fee agreement, or every one above a set amount, to be in writing. Check your state's Rule 1.5 before you rely on an oral agreement.
What must a contingency fee agreement say?
Under Rule 1.5(c) it must be in writing, signed by the client, and state how the fee will be determined, including the percentage or percentages the lawyer earns at settlement, trial or appeal; the litigation and other expenses that will be deducted from the recovery; and whether those expenses are deducted before or after the fee is calculated. It must clearly say which expenses the client owes whether or not the client wins. At the end of the matter the lawyer gives the client a written statement of the outcome and, if there is a recovery, the amount sent to the client and how it was figured.
When is a contingency fee not allowed?
Rule 1.5(d) forbids a fee in a domestic relations matter that is contingent on securing a divorce or on the amount of alimony, support or a property settlement in lieu of them, and a contingency fee for representing a defendant in a criminal case. States add their own limits, such as percentage caps in some kinds of cases.
Can I call a flat fee or a retainer nonrefundable?
That is decided state by state, and the answer differs. Some states allow a flat fee to be treated as earned on receipt with specific written disclosures; others require the unearned part to be refunded if the engagement ends early and require advance payments to sit in trust until earned. The letter leaves this place marked for you to write after you check your state's rule.
What is the difference between an engagement letter and a fee agreement?
In practice they are the same document: a letter from the lawyer to the client that sets out the scope of the work, how the lawyer charges, what the client pays for, how billing works and how the engagement can end, which the client signs to show agreement. The letter this form builds is both.
Does this letter satisfy my state's rules?
It does not claim to. It is a starting point that covers what the ABA model rule asks for and marks the places your state decides. Have it reviewed for your state's rules before you use it. It is not legal advice.
Does what I type leave my browser?
No. The letter is built in your browser from what you type, and the page keeps no record of it. Copy, download or print the letter; closing the page discards everything.
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