Written fee agreements between clients and their attorney should always be utilized.
First, the client will know exactly what is expected of the client as far as the amount and timing of the payment of the attorney and payment of court costs, as well as other expenses that may be incurred by the attorney.
Second, the fee agreement, if it is well-written will inform the client of what services will be provided by the attorney and what services will not be provided. Also, a good fee agreement will provide the client with an accurate idea of the cost of extra services, if extra services become necessary.
This office always tries to provide a firm fee quote is Chapter 7 cases because virtually all fees and costs in Chapter 7 cases must be paid prior to filing the case. Otherwise, the attorney is a creditor and is not permitted to assert a claim for services previously provided but not yet paid. This means the attorney’s debt (unpaid fee) will be discharged in the bankruptcy case. Of course, that is not a good situation for anyone.
Our office charges a base fee for the basic Chapter 7 consumer bankruptcy of $1,300, plus the court filing fee of $306, for a total of $1,606 from beginning to end. The attorney fee increase with the complexity of the case, for instance where a business is involved; or judgment liens have been filed in the state court and need to be removed; or other complexities. Normally, these issues can be identified prior to filing; but not always.
In Chapter 13 cases, the base consumer fee is $4,500 plus the court filing fee of $281. Because a Chapter 13 case lasts at least 36 months (and up to 60 months maximum) and because the debtor is making payments into the court system, part of the attorney fees can be paid from the money the debtor pays into court. Normally, our office requests that $1,500 of the attorney fee and the entire $281 in court costs be paid prior to filing. The rest of the fees can be paid through the Chapter 13 Plan payments. When it comes to Chapter 13 cases, our office is flexible in the fees because the cases last several years and future income and future expenses can change unpredictably.
Here are our model fee agreement forms: