Working with a Lawyer: Decoding Evergreen Retainers

We excel at being able to break down difficult legal topics for our clients and working with us should be no different. Clients frequently ask us to explain our “evergreen retainer” system:

What is an evergreen retainer for legal services?  

An evergreen retainer is an arrangement in which the client pays a deposit into a trust account and the law firm invoices its services against the trust account. When the amount in the trust account drops below an agreed upon level, the client “tops off” the retainer making it “evergreen”. 

How does an evergreen retainer work? 

At the end of each month, the law firm invoices against the trust account and sends the client an itemized invoice. If the invoiced amount is less than the amount in the trust account, the client is asked to “top off” the trust account. If the invoice is more that the trust account, the client is asked to pay the overage and replenish the trust account. 

What information is included in the invoice?  

The invoice shows itemized entries for billable time spent on the client’s matter to 1/10th of an hour (6 minute increments) and expenses paid on the client’s behalf. Expenses could include filing fees, overnight mail services, legal research costs, credit card or e-check fees, and third-party professional services authorized by the client. We do not pass along overhead for standard mail or routine photocopies. 

The invoice also shows any money deposited into or withdrawn out of the trust account. For example, if the client receives a settlement, the settlement check will be deposited into the trust account and the law firm will write a check to the client after the settlement check clears and outstanding invoices and expenses have been paid.   

Is the trust account refundable?  

Yes, at the end of the engagement, any money left in the trust account is refunded to the client after all services and expenses have been paid. 

What if I have questions about an invoice?  

Please contact us within 10 days of the date of invoice with any questions. After 10 days, the invoice is considered final. 

How much is the evergreen retainer? 

We set the initial deposit amount and replenishment threshold based on the client’s anticipated needs. Each client receives the terms and conditions in their own engagement letter. Our minimum trust deposit to begin work is $1,500. Clients can pay securely online by e-check or credit card. Some clients also choose to leave a payment method on file to automatically top off the retainer each month.  

Is the evergreen retainer a subscription?  

No, you only pay for the legal services you use. Some law firms claim to provide unlimited services for a low subscription fee – we don’t believe that’s realistic. We tailor all of our advice, drafting, and other services to each client while paying our employees and vendors competitive market rates.  

Is the evergreen retainer a flat fee?  

No, our time is billed on an hourly basis unless we include in the engagement letter that a particular service will be invoiced on a flat-fee basis. 

Why does the firm use an evergreen retainer system?  

The most important reason is that lawyers are bound by rules of professional conduct which require us to keep client funds in a “trust account”, which is separate from the firm’s “operating account”, until after fees are earned. Second, evergreen retainers are a “pay as you go” system which allows clients to spread their legal costs out as services are provided instead of paying a large upfront fee. Additionally, evergreen retainers improve the firm’s administrative efficiency and cash flow, allowing us to keep our hourly rates lower and pass those savings on to our clients.  

Who gets the interest earned on funds in the trust account? 

By law, interest on trust accounts is automatically forwarded to Maryland Legal Services Corporation and used to support organizations in Maryland providing legal help to persons of limited means.  

Please do not hesitate to contact us with any questions.

Natasha M. Nazareth, Esq.
Ginny Cascio Bonifacino, Esq.