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.

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“Dennis, I am a superior court judge in a city where your column is very popular. In fact, for many years at one outlying courthouse, the judge taped each week’s story to the front door for the public to read.

“Today, so many TV shows, movies and lawyer ads have created a false image of how easy and inexpensive it is to hire an attorney. More than ever before judges are seeing the results of a failure to explain the financial facts of life to clients.

“These issues would make for an interesting article, especially with your ‘Leave it to Beaver’ sense of humor!”

A comforting shoulder

When lawyers get together socially, much as wives complain to each other about their husbands (generally, with good reason) and husbands complain about their wives to their buddies (sometimes justifiably) lawyers gripe about those clients who we wish had never heard of us.

Emotionally, the practice of law can be deeply rewarding, allowing us to save the world – of an individual, a family or small business–but this isn’t a happy line of work. Lawyers deal with people who have legal problems and problem people. To many, we fill the role of a member of the clergy or mental health care professional – always there to listen, a shoulder to cry on, someone who will dive into murky waters to help.

But paying for the time with that comforting shoulder? To some clients, that’s a different matter, for which we are largely responsible.

‘No one works for free’

For many years, Ruth Carter was a mental health care professional, “Which was excellent preparation for what I do now as a lawyer,” she told You and the Law.

“In seminars for attorneys who go out on their own, I stress these critically important points about money which lawyers need to make clear from the very first meeting with a client and presented in a conversational manner which encourages questions:

• Most of the work I do is billed on an hourly basis, just like an auto mechanic, a plumber or electrician, with separate charges for parts and labor. In law, we call these: fees and costs. Fees are what I am paid for my time or that of other lawyers and support staff working on your case.
• Personal injury cases — such as auto accidents — are generally handled on a Contingency Fee Basis, where fees are a percentage of the amount obtained through settlement or trial. If there is no settlement or if we go to trial and lose, then I am not owed any fees. But you could still be responsible for my costs.
• Costs are all those things which are necessary to either begin your case — such as the court filing fee — or which support the case: obtaining medical records, police reports, hiring experts who evaluate your case, prepare a report and testify, private detectives, travel, depositions, to list just a few.
• I know this will sound harsh or sarcastic, but please understand that as much as I want to help you, I have to eat. We all have obligations to our family, to pay the bills of everyday life, and in a law firm, my staff.
• If I am not billing — or not being paid — then I am not making money. The only thing that creates income for lawyers is our time and advice. That’s what we sell.
• There are many reasons a lawyer will not accept a new case, and often it comes down to a client who just cannot afford to hire the lawyer. It isn’t that I do not want to help or don’t care, or that you do not have a good case. It is just that I can’t work and not be paid.

When a conscientious lawyer agrees to take on a new client, one of the most important of any professional relationships has just been established. Clients expect — and have the right — to competent representation, and the lawyer’s full attention. As Carter points out, it is a two-way street:

“Clients need to understand and accept their obligations, one of the most important is to pay our bills promptly. It’s not just about money, but hearing one excuse after another can have major, negative consequences on the case,” she explains.

“When you hire me, we are engaged, but if you don’t pay me, the result is that I feel not respected and being used for your personal gain. This is how lawyers react, and it isn’t good for their clients.”

Next time: It’s not what you believe. It is what you can prove.

Ruth Carter’s website is a “must visit” for anyone who blogs and wants to keep out of legal hot water. www.carterlawaz.com

Dennis Beaver practices law in Bakersfield and enjoys hearing from his readers. Contact Dennis Beaver.

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