My small business lawyer asked for a retainer of 3500$ to file incorporation papers and help create a partnership. As is standard and in most retainer agreements, my business partner and I were told that we would be notified if we incurred additional expenses on a monthly basis and that the firm would obtain instructions from us before they went any further should the retainer deplete. This was in June. Today, they sent us a bill totalling almost 10 thousand - 6500$ in additional fees for emails and a handful (three) zoom calls negotiating terms with NO knowledge or instruction to us letting us know we owed more money. How can we proceed? We cannot afford this, it will likely put us under.
$10k seems absurd for forming a partnership
For a standard partnership, yeah, that’s absurd. For those kinds of numbers, you’d have to have asked for something unusual and bespoke. I’ve charged those kinds of numbers to iron out a massive custom partnership agreement during a change in ownership, but never for a standard startup.
Mine was $6k total for formation and partner agreement, which included writing custom stuff for 4 partners.
Crazy that the lawyer couldn’t look at the situation and tell their client that their regular fees would be absurdly out of proportion for the value given to a small startup.