The counterpart of a law-department retention letter is a law-firm engagement letter (See my posts of Aug. 24, 2006 that compare inside retention letters to outside counsel guidelines; Sept. 25, 2006 on the integration of retention letters and other guidelines and tools; and May 19, 2006 on AXA Konzern’s concerns.). You can find online a good example of an engagement letter, one prepared by the Pittsburgh law firm Meyer, Unkovic & Scott.
The posted engagement letter states clearly the terms under which the firm will represent a client (See my post of Nov. 3, 2005 on the importance of stating fixed charges.). In other posts I touch on two paragraphs of particular interest: late payment charges and storage of files (See my two posts of Nov. 5, 2006.).