ENGAGEMENT LETTER FOR LEGAL SERVICES

(North Carolina – Attorney–Client)

[// GUIDANCE: This template is designed for matters governed by the North Carolina Rules of Professional Conduct and North Carolina state law. Bracketed items MUST be customized prior to execution. Remove all guidance comments prior to final delivery to the client.]

I. DOCUMENT HEADER

This Engagement Letter for Legal Services (the “Engagement Letter”) is entered into as of [Effective Date] (the “Effective Date”) by and between:

1. [CLIENT NAME], a [jurisdiction/type of entity or “natural person”], with a principal place of business/residence at [Client Address] (“Client”); and
2. [ATTORNEY FIRM NAME], a North Carolina professional corporation/PLLC with its principal office at [Firm Address], whose attorneys are duly licensed to practice law in the State of North Carolina (“Attorney,” and together with Client, the “Parties,” and each a “Party”).

Recitals

A. Client seeks professional legal representation in connection with [brief description of matter] (the “Matter”).
B. Attorney is willing to provide such representation subject to the terms and conditions set forth herein.
C. The Parties intend for this Engagement Letter to satisfy the disclosure, consent, and record-keeping requirements of the North Carolina Rules of Professional Conduct, including Rules 1.5, 1.7, and 1.15.

NOW, THEREFORE, in consideration of the mutual promises herein and other good and valuable consideration, the receipt and sufficiency of which are acknowledged, the Parties agree as follows:

TABLE OF CONTENTS

1. Definitions
2. Operative Provisions
      2.1 Scope of Representation
      2.2 Fees, Retainer, and Billing
      2.3 Client Responsibilities
      2.4 Term and Termination
3. Representations & Warranties
4. Covenants & Restrictions
5. Default & Remedies
6. Risk Allocation
7. Dispute Resolution
8. General Provisions
9. Execution Block

II. DEFINITIONS

“Applicable Rules” means, collectively, (i) the North Carolina Rules of Professional Conduct; (ii) all other governing ethical, statutory, and regulatory provisions of the State of North Carolina; and (iii) any federal rules or statutes that may govern the Matter.

“Billing Cycle” means the monthly period ending on the last calendar day of each month, unless otherwise agreed in writing.

“Fees” means Attorney’s compensation for professional services, calculated in accordance with Section 2.2.

“IOLTA Trust Account” means Attorney’s Interest on Lawyers’ Trust Account maintained in compliance with N.C. R. Prof. Conduct 1.15.

“Retainer” means the advance deposit described in Section 2.2(b).

“Scope of Representation” has the meaning set forth in Section 2.1(a).

All other capitalized terms have the meanings ascribed to them in the text of this Engagement Letter.

III. OPERATIVE PROVISIONS

2.1 Scope of Representation

(a) Attorney will represent Client solely in connection with the Matter and reasonably related proceedings and negotiations (the “Scope of Representation”).
(b) Exclusions. Unless expressly expanded by written amendment, representation does NOT include (i) tax advice, (ii) appeals beyond the trial-level court or specified administrative agency, (iii) business management decisions, or (iv) services unrelated to the Matter.
[// GUIDANCE: Customize exclusions to match the actual engagement.]

2.2 Fees, Retainer, and Billing

(a) Fee Structure. Attorney shall charge [hourly rates/flat fee] as follows:
• Partner: $[rate]/hour
• Associate: $[rate]/hour
• Paralegal: $[rate]/hour
• Flat Fee (if applicable): $[amount] payable as set forth below.

(b) Retainer. On or before the Effective Date, Client shall deposit $[Retainer Amount] (the “Retainer”) into the IOLTA Trust Account. The Retainer is earned only as Fees accrue and shall be applied to outstanding invoices. Any unapplied balance will be refunded promptly upon termination.
N.C. R. Prof. Conduct 1.15 requires that unearned funds remain in trust until earned.

(c) Costs & Expenses. Client is responsible for all reasonable and necessary costs (e.g., court filing fees, expert witness fees, travel) incurred on Client’s behalf. Costs exceeding $[threshold] will require advance approval.

(d) Billing & Payment. Attorney will furnish detailed invoices no later than five (5) business days after the end of each Billing Cycle. Payment is due within thirty (30) days of the invoice date.

(e) Late Payment. Balances unpaid after thirty (30) days shall accrue a finance charge of [percentage] % per month (or the maximum lawful rate, if lower). Persistent delinquency constitutes an Event of Default under Section 5.1(a).

(f) Fee Disclosure Compliance. The foregoing complies with N.C. R. Prof. Conduct 1.5; Client acknowledges having been advised of the basis, rate, and terms of the Fees and expenses.

2.3 Client Responsibilities

Client shall (i) provide truthful and complete information; (ii) remain reasonably available for consultation; (iii) cooperate with Attorney’s reasonable requests; and (iv) timely satisfy all financial obligations under this Engagement Letter.

2.4 Term and Termination

(a) Term. This Engagement Letter becomes effective on the Effective Date and continues until the earliest of (i) completion of the Scope of Representation, (ii) termination under subsection (b), or (iii) order of a tribunal.
(b) Termination. Either Party may terminate upon written notice, subject to Applicable Rules. Attorney may withdraw for nonpayment, conflict of interest, or other good cause as permitted by N.C. R. Prof. Conduct 1.16.
(c) Post-Termination Duties. Upon termination, Attorney will promptly provide Client’s file and any unused Retainer balance, subject to lien rights for unpaid Fees.

IV. REPRESENTATIONS & WARRANTIES

4.1 Attorney represents and warrants that:
(a) Each attorney working on the Matter is duly licensed and in good standing with the North Carolina State Bar;
(b) Attorney maintains professional liability insurance in an amount not less than $[policy limit]; and
(c) No conflicts of interest exist, other than those expressly disclosed in Section 4.3.

4.2 Client represents and warrants that:
(a) Client has full authority to engage Attorney and to perform its obligations; and
(b) Information provided to Attorney is, to the best of Client’s knowledge, true, complete, and not misleading.

4.3 Conflict Disclosure. Attorney has disclosed the following potential conflicts: [describe “None” or list]. Client hereby gives informed consent to Attorney’s continued representation pursuant to N.C. R. Prof. Conduct 1.7.

4.4 Survival. The representations and warranties in this Section survive termination of this Engagement Letter.

V. COVENANTS & RESTRICTIONS

5.1 Confidentiality. Attorney shall maintain confidences in compliance with N.C. R. Prof. Conduct 1.6, subject to legally mandated exceptions.

5.2 Client Cooperation. Client shall not: (i) withhold material information; (ii) request Attorney to engage in conduct that violates law or ethical rules; or (iii) communicate with represented adverse parties without Attorney’s consent.

5.3 File Retention. Attorney will retain the Matter file for [X] years after termination, after which it may be destroyed unless Client requests return of the file beforehand.

5.4 Communications. Client authorizes Attorney to use unencrypted email and cloud-based services for routine communications unless Client delivers contrary written instructions.

VI. DEFAULT & REMEDIES

6.1 Events of Default
(a) Client Default. (i) Failure to pay any invoice within forty-five (45) days; (ii) material breach of Section 2.3 or 5.2.
(b) Attorney Default. (i) Material breach of Applicable Rules; (ii) willful misconduct or gross negligence in performing legal services.

6.2 Notice & Cure. The non-defaulting Party shall give written notice specifying the default. The defaulting Party shall have ten (10) days to cure monetary defaults and fifteen (15) days to cure non-monetary defaults, except where the default is incapable of cure.

6.3 Remedies
(a) If Client is in default and fails to cure, Attorney may (i) suspend work; (ii) apply Retainer funds to outstanding Fees; (iii) withdraw from representation; and (iv) pursue collection (including reasonable attorney fees).
(b) If Attorney is in default and fails to cure, Client may terminate this Engagement Letter and seek appropriate legal or equitable relief.

VII. RISK ALLOCATION

7.1 No Guarantee. Attorney makes no express or implied warranty regarding the outcome of the Matter.

7.2 Indemnification – Professional Liability. Attorney shall indemnify and hold Client harmless from damages finally adjudicated to have been caused by Attorney’s willful misconduct, fraud, or violation of Applicable Rules.

7.3 Limitation of Liability.
[OPTION A – Include Cap]
Subject to N.C. R. Prof. Conduct 1.8(h) and conditioned upon Client’s opportunity to seek independent counsel, Attorney’s aggregate liability for malpractice or breach under this Engagement Letter shall not exceed [Dollar Amount or “the total Fees paid by Client under this Engagement Letter”].
[OPTION B – Omit Cap]
The Parties agree that no prospective limitation of malpractice liability is made herein.
[// GUIDANCE: Select the option that aligns with ethical compliance and client election.]

7.4 Force Majeure. Neither Party is liable for delay or failure to perform caused by events beyond its reasonable control, provided that such Party gives prompt notice and resumes performance as soon as practicable.

VIII. DISPUTE RESOLUTION

8.1 Governing Law. This Engagement Letter shall be governed by and construed in accordance with the laws and professional rules of the State of North Carolina without regard to conflict-of-laws principles.

8.2 Forum Selection. Any action arising out of or relating to this Engagement Letter shall be brought exclusively in the state courts located in [County], North Carolina.

8.3 Mediation. Prior to litigation or arbitration, the Parties shall, in good faith, participate in mediation administered by the North Carolina Dispute Resolution Commission or its successor.

8.4 Arbitration (Optional).
[OPTIONAL] Subject to N.C. Rev. Stat. § 1-567.1 et seq., any dispute not resolved within sixty (60) days after mediation may, upon mutual written consent, be submitted to binding arbitration before a single arbitrator selected per the AAA Commercial Arbitration Rules. Judgment on the award may be entered in any court of competent jurisdiction.

8.5 Jury Waiver (Optional).
[OPTIONAL] EACH PARTY KNOWINGLY AND VOLUNTARILY WAIVES ITS RIGHT TO A TRIAL BY JURY IN ANY LITIGATION ARISING OUT OF THIS ENGAGEMENT LETTER.

8.6 Injunctive Relief. Nothing herein limits either Party’s right to seek provisional or injunctive relief as necessary to protect its interests in confidentiality, trust funds, or other exigent circumstances.

IX. GENERAL PROVISIONS

9.1 Amendment & Waiver. No amendment or waiver is effective unless in writing and signed by both Parties. A waiver of any breach is not a waiver of any subsequent breach.

9.2 Assignment. Neither Party may assign or delegate its rights or obligations without the prior written consent of the other Party, except that Attorney may assign billing and collection rights to an affiliated entity.

9.3 Severability. If any provision is held unenforceable, the remaining provisions shall remain in full force, and the invalid provision shall be interpreted to fulfill its intended purpose to the maximum lawful extent.

9.4 Entire Agreement. This Engagement Letter constitutes the entire agreement between the Parties regarding the Matter and supersedes all prior agreements or understandings, whether written or oral.

9.5 Counterparts; Electronic Signatures. This Engagement Letter may be executed in counterparts, each of which is deemed an original, and all of which together constitute one instrument. Signatures delivered by PDF or electronic signature technology (e.g., DocuSign) are binding and enforceable.

X. EXECUTION BLOCK

IN WITNESS WHEREOF, the Parties hereto have executed this Engagement Letter as of the Effective Date.

[// GUIDANCE: Notarization is generally NOT required for engagement letters in North Carolina, nor are witness signatures, but include if the client’s policies so mandate.]

Prepared in accordance with N.C. Rules of Professional Conduct, including R. 1.5 (Fees), R. 1.7 (Conflict of Interest), R. 1.15 (Trust Accounts), R. 1.16 (Declining or Terminating Representation), and R. 1.8(h) (Limiting Liability).