How Attorneys Fees are Determined and Etiquette in Dealing with Attorneys

Most attorneys offer a short consultation with potential new clients to see if the subject matter and client fit their law practice. You should expect to be honest and open about your legal problem, and answer any questions the attorney asks you about the matter and other people involved. Attorneys need to know who else is involved so they can avoid conflicts of interests with their existing clients.

A few attorneys will even answer general legal questions. This should not be interpreted as an invitation to call more than once and ask additional questions. The second phone call should be to notify the attorney that you want to hire him (if you have not done so already) and arrange the details.

Don’t be offended if the attorney says ‘no’ to accepting you as a client—there are many reasons attorneys turn down clients, and in some cases the attorney has no choice under state-mandated rules of professional ethics.

When I get calls from prospective clients, frequently they want me to immediately tell them what to do about their legal issue, sometimes before they tell me their name.

Keep in mind that attorneys sell only one thing: Time. Not legal advice or contracts. Their time. And to take it without paying for it is, quite simply, stealing.

How Fees are Set

Attorneys set fees like any other business, using a calculation based on costs and expected profit. For an attorney, the calculation may include the prestige and cost of their schooling, their overhead, and their experience in a particular subject matter.

For a client, the calculation should be whether the cost of the attorney adds a comparable value to their venture or saves them a comparable amount of money by resolving a problem.

Unfortunately, some clients compare attorneys based on their hourly rate, and choose the one with the lowest rate. These people don’t seem aware that an experienced attorney is typically more efficient than a less experienced attorney, and can get more done, with better quality, in less time.

The overall cost of an experienced attorney, especially a subject-matter specialist, is often less than a “cheaper” inexperienced attorney, even when the incremental cost is higher. This is true not only in immediate time savings, but also in the long term by avoiding mistakes and the expense of resolving problems those mistakes cause.

Negotiating Fees

If you have budget constraints, say so early, so the attorney has an idea of whether he can afford to help you. That way, both of you can avoid wasting time.

You should not expect attorneys to spend a great deal of time negotiating their fees with you. Most attorneys set their fees based on careful calculations and expectations of a reasonable profit. If they regularly work for free, or at a loss, they won’t be around to help you very long. No matter how worthy your cause, you should not expect them to donate services free of charge or at a reduced rate unless they have explicitly offered to do so.

In general, beware of an attorney who permits you to dictate how much his or her fee will be. Especially if you need help negotiating a business transaction or settling a dispute, the last thing you want is an attorney who doesn’t have the backbone to stand up to a bad deal you’re offering her. If you can do it to him or her, so can your opponents. You need a zealous advocate who can work out the best deal possible.

Similarly, you should be wary of attorneys who are overly flexible about negotiating fees. It may mean they are inexperienced and expect to learn as they represent you—which can be very costly when they make mistakes on your behalf. Or, it could be a sign that the attorney does not intend to spend much time and care in representing you and will not make your matter the priority it deserves to be.

In my practice, I recently began offering flat fees for common services. This allows my clients to predict their legal costs and budget accordingly. It allows me to get paid in advance, avoid the costs of collection, and pass that savings on to my clients.

For more information about my fees and a chart showing my current Pre-Paid Fees for Services, go to the Production Counsel fees page.

© Keith E. Cooper. All rights reserved. You may freely link to this post, but please do not copy (in whole or in part) without permission of the copyright owner.

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One Response to “How Attorneys Fees are Determined and Etiquette in Dealing with Attorneys”

  1. Virginia Attorney says:

    I hope my future clients read this before they call me!