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The Issue of Legal Fees

To both the client and the attorney the issue of fees is of utmost concern. The client wants professional service at a fair price and the attorney wants reasonable compensation for his efforts. Yet, few things strain the attorney-client relationship as often as the issue of fees.

Perhaps the matter can best be illustrated from the attorney’s perspective by the example of the customer that approached the contractor stating that he wanted the contractor to build a house for him. The first question that the customer asked was "what will it cost?" Of course, the contractor was unable to tell him. What materials do you want to use? How many bedrooms will the home have? Is it to be a ranch style or two story? So it goes with most financial purchases we make – whether it be a car, television or clothing. There are always alternatives that increase the final cost.

What makes legal fees so different and difficult is that it is not possible for the attorney – or the client - to anticipate where their legal endeavor will take them. The primary reason for such uncertainty is that most legal matters involve other people, and people are very unpredictable. It is one thing to decide at the outset that you are willing to pay an extra thousand dollars to get the super duper stereo as an accessory – it is quite another to have the opposing party in a lawsuit file bankruptcy when you least expect it.

There are some meaningful principles that you can rely upon when agreeing upon fees with your attorney. First, be certain that you do discuss monetary arrangements and that both you and the attorney understand how fees are to computed and paid. All law firms will consider a flat fee, contingency fee, modified contingency fee, hourly fee, or other different or creative fee arrangement that are both fair to the client and attorney. But don’t permit the mistake of believing the attorney is working for you on a flat fee basis while he thinks he is working on an hourly arrangement. We consider it our responsibility to discuss financial responsibilities with our clients at the outset of any undertaking. However, if the attorney does not introduce the subject, then you make certain that you do. This is one area in which neither party should allow a lack of clear communication.

Second, be fair. Recognize that ninety percent of the attorney’s work will be done outside the sight of the client. When you receive that one page document, recognize that five hours of research and document analysis had to be performed before an accurate and complete document could be prepared. It is often an interesting phenomenon when a client will make a $50,000 or $75,000 concession in a business transaction on almost a whim, and then nit-pick a $5,500 legal bill after the attorney has worked late into the night trying to assure that the client’s deal goes together.

Third, expect reasonableness from the attorney. The American Bar Association's Model Rules of Professional Conduct set forth the basic rules that govern all fees. Rule 1.5, which addresses lawyers' fees, states, "A lawyer’s fee shall be reasonable." It then sets forth eight factors to consider in determining the reasonableness of a fee. Such factors include the effort expended, the level of expertise required, time limits imposed on the attorney, outcome, loss of other business for the attorney, and so on. Understand that all such factors impact the attorney's ability to protect you (as well as himself) from malpractice and earn a living for his family. Still, the underlying principle is reasonableness, taking into consideration all of the applicable factors. If you have any concern about the reasonableness of what you have been charged, you should discuss it openly and candidly with the attorney. He should either make a proper adjustment in the bill or help you to understand and appreciate the effort that was expended, the true nature of results that were obtained, or other basis upon which he considers the fee to be reasonable.

Fourth, do what you agree to do and pay promptly or in advance. Many clients resist payment of retainers – simply because they are under the mistaken notion that a retainer is intended only to protect the attorney. Wrong! All attorneys are human beings, and when an attorney suspects someone is attempting to take advantage of his years of study and preparation, or otherwise "stiff" him, he may become distracted from the job at hand and begin to contemplate how he can cut the losses he is going to experience from his "deadbeat client". No one can be totally committed to a cause when doubts of fair dealing cloud the relationship. Payment in advance or prompt payment of every invoice assures the avoidance of a strained relationship that can not help your case. If you become concerned about your ability to pay the attorney’s fee – it is your responsibility to discuss it with him before it becomes a problem.

We believe that a key element to a successful completion of your legal matter rests upon clear understanding and complete agreement of the fee arrangement with your attorney. We take great pride in the services we render. We have helped many people with serious and difficult matters for many years. We want to be absolutely honest in our dealings and deliver professional and competent services for many years to come. We also believe that our continued job satisfaction and success rests heavily upon the relationships we obtain and maintain with our clients.

© 2008 Rowley Chapman Barney & Buntrock, Ltd.  All rights reserved.

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