September 10, 2016 • By Dennis Beaver
Are you being overcharged by your lawyer? How can you know? And if you really are, is it possible that you — yes, you, the client — are partially to blame?
We asked San Francisco-based lawyer John O’Connor — who is a nationally recognized attorney fees expert — and spent close to an hour in the kind of discussion that every law student should have. O’Connor’s answer to these questions shines a light on why clients often wonder if they are billed correctly.
“It is very hard for the average person to know whether the fees are reasonable,” he points out, adding, “And this is because most people do not understand what needs to be done in a legal matter.”
As O’Connor explains, there are two distinct situations clients need to be aware of, and include:
• Lawyers who are billing reasonably but not clearly explaining the work that is being done coupled with the client’s lack of familiarity with the legal process.
• Lawyers who are overcharging, and clients sense it, but for the ordinary person it is difficult to articulate why.
In auditing attorney bills, he has found that law firms with good reputations overcharge but not because they are attempting to take advantage of the client.
“Sometimes a law firm acting with the best of intentions puts too much fire power on a case which could be handled with a greater discipline and moderation that is proportionate to the amount involved. The expensive result is that the same number of people are put on a normal, small dollar value business dispute who should be put on a much larger matter.”
To O’Connor a real danger lies, “When both clients and lawyers become so involved with the details of the case — spending a huge amount of time fighting over everything — and lose sight of the main issue: What is this case really worth? ‘Are we going to spend $50,000 in attorney fees for a case worth only $25,000?’
“We need to combat the natural human tendency to think that a case is more important — or has a greater value — than it really is. When you have a client who says ‘I want to go all guns blazing,’ to some lawyers this encourages not looking at the economics of the case.
“The seeds of a very unhappy attorney-client relationship are often planted,” he warns, “when a client tells you to go all out but does not know how much it’s going to cost.”
Lawyers have a legal duty to first think of what is in the client’s best financial interest, not their own.
In states such as California and New York with a mind-boggling over-supply of inexperienced lawyers, O’Connor often finds, “glaring conflicts of interest — especially where a lawyer gets a case which could easily be settled, but reasons, ‘If I keep the litigation going, I’m going to make a lot of money.’
“We find this most often in family law where emotions tend to drive litigation that is not worth the cost,” he accurately observes.
So, how do you reduce the chances of being taken advantage of and stuck in unjustified, horribly expensive litigation? O’Connor has two suggestions: Have a talk about money and obtain a second opinion:
“It is important for clients to learn what the case might cost. Do not be afraid to discuss money. Surprisingly, many clients will haggle over the price of a car, but are afraid to ask how much their lawyer expects to charge them.
“This is understandable as a good attorney-client relationship is built on trust and confidence, so a client might easily feel awkward suggesting a second opinion, but it is frequently a good idea.
“One approach is by saying, ‘I have a friend, who would love to take a look at this to help me make sense of it.’ It can never hurt by having someone look at your case at an early stage, in a friendly and non-confrontational way,” he recommends.
As we learned, a second opinion can also be important to obtain when you are deep into the case:
“It is difficult over-emphasize the reality of this built-in conflict of interest between attorney and client, especially when it comes to settling a case. If you want the case settled but your lawyer does not, get a second opinion quickly,” O’Connor recommends.
So, you have had that discussion about money, obtained a second opinion and retained the lawyer, confident in having made the right choice. But then the first bill arrives and the doubts begin.
Next time we’ll study that bill together and point out what’s wrong.
Dennis Beaver practices law in Bakersfield and enjoys hearing from his readers. Contact Dennis Beaver.