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Success in Your Fee Agreements

I believe that a lawyer unpaid is justice denied. Too often, I hear of lawyers not being paid for the great work they do, or having to write-off some or all of a client bill. Part of what I do is to work with lawyers and law firms to maximize the money they earn.  But when I read stories, like the one that follows, I just shake my head and wonder "What the hell were they thinking?!

Our society and economy allows lawyers to earn a very healthy living, limited only by the often-ignored "reasonableness" factors listed in Model Rule 1.5. However, when a lawyer's fee agreement, drafted by the lawyer, also imposes limits, then we must live by those limits or face the righteous wrath of clients.  That's the lesson of this story in the Connecticut Law Tribune. 

According to the story, a Connecticut divorce lawyer included a success fee provision in the fee agreement that stated "In addition to the hourly charges described, we may request an additional reasonable charge for matters of extraordinary difficulty, or which require special expertise or the giving of special priority treatment...This additional charge is subject to your approval after discussion with you. It cannot be imposed unless you agree to it."

So far so good. As a former divorce lawyer, I like what I've read so far.

Apparently in the midst of an intense 5-day mediation effort to resolve the divorce, the attorney insisted on a $300,000 success payment pursuant to the fee agreement.  The client balked, but finally paid the bonus after his attorney became "angry and abusive" according to the testimony at trial. 

Not surprisingly, the Connecticut jury found that the client did did not agree to the bonus and the court ordered his lawyer to return the money.  Now the lawyer is seeking to overturn the verdict and get a new trial. 

Excuse me?  He's what?

Lawyers, like everyone else, must live with the benefit of their bargain. We must carefully draft our fee agreements and be prepared to live with them. (Just like we expect our clients to honor them too.) Sure, we can attempt to renegotiate the deal if we don't like it, but we can't unilaterally make that change and expect the client to accept it. 

Isn't that a basic prinicple we all learned in law school?

Great Blogger Story in Washington Lawyer

The April 2005 issue of Washington Lawyer, published by the District of Columbia Bar is now on-line, and features an in-depth story of legal blogging written by veteran reporter, Sara Kellogg.  She does a nice job of introducing legal readers to the world of blogging with help from such pioneers as Dennis Kennedy, Amy Howe, Ernie Svenson, among others.  The article also highlights the potential benefits and ethical pitfalls of blogging, so be sure to check it out!

Bored: How to Reenergize Your Professional Life

One of the unspoken realities of law practice is that boredom seeps into a lawyer’s practice after a few years.  If you can make it 8 or 10 years, you are ahead of the curve.  Lawyers get restless for change, but sometimes that restlessness turns to carelessness.  Careless mistakes can cause trouble, so beware of the symptoms, the greatest of which is delaying almost everything until the last possible moment to get the biggest possible “rush” out of the challenge to still meet the deadline.  If you know what I’m talking about, read on. 

So what can you do about it?  A practicing lawyer can change four aspects of their practice to relieve the sense of boredom: practice setting, practice area, clients, and their attitude. 

Probably the most common occurrence is a lawyer’s desire to change practice setting–leaving one firm or employer to another.  Often the change is from big firm to small, solo practice to small firm, or private practice to in-house practice.  This change of practice setting leads to new challenges that can help break the monotony and boredom some lawyers experience after a few years of practice.  A more drastic change of setting is to leave the practice of law for a another profession or related profession.  Certainly a common course of action, but it leaves behind an investment of time in the skills and knowledge needed to practice law.

Another way to relieve boredom is to change the mix of clients.  This requires an assessment of current clients to find out what you like and dislike about them.  Find the common attributes of your favorite clients, then use that information in your marketing and client selection process.  Accept only the clients that meet your standards.  Boredom wanes when we enjoy the challenge of helping clients we like.

Changing your practice area is another way to relieve boredom.  By creating new challenges, a lawyer can erase the restlessness that is associated with work we don’t like.  Adopting a new practice area comes with challenges too.  A lawyer must learn the new area to gain competence before representing clients.  Taking CLE courses in your area is a good start. You may need to seek permission from your firm, so create a plan to show how this new practice area could help the firm.  Try to choose practice areas that are complementary to your existing cases and clients; that will help with marketing the new practice area.

The final aspect of your practice that you can change is your attitude. Sounds harsh, but sometimes all it takes is a personal decision to enjoy what we have.  Take a few minutes to write down the pros and cons of your current situation.  If the pros outweigh the cons, then maybe you need to adjust your outlook.  But if the cons outweigh the pros, then try the changes suggested above.

Always remember, you are a well-educated professional, and have skills and abilities to do just about anything that makes you happy, so when boredom seeps in, take control of your destiny to make positive changes in your professional life!

Good-bye Paradise, Hello Blog World

My posts have been scarce over the past several weeks, as I have been on a family trip to Asia.  We spent time in Bangkok, Manila, and Boracay with family members residing in that wonderful part of the world.  Enjoyed the paradise of Boracay Island as well as spending valuable time learning from lawyers, diplomats, and businesspeople in Bangkok and Manila.  With my batteries recharged, I look forward to Techshow and LexThink in Chicago next week.  Hope to see you there--but I promise, no slide shows of my vacation! :-)

Simple But Effective Marketing

Locating the service agent for a foreign corporation can be a common task for lawyers and their paralegals, but it is a thankless one. The Internet made it easier, but it took Maryland attorney and entreprenuer, Terry Berger, to make it painless.  Terry hosts Resident Agent Info, a web site that makes it a snap to find the resident agent for corporations in all 50 states and the District of Columbia.  The info is free from all but three states, as Terry makes clear. It's a web site that every lawyer should bookmark.

I also applaud Terry for his shrewd marketing.  His site provides the information as a public service, promotes his law practice and he collects a bit of ad revenue at the same time. I'll bet the site gets 100 times more the views than one that would just promote his law practice. A good lesson for us all.

Wasting Time is a Thing of the Past

If you are often in court or away from your office, you know how hard it is to remember to log your time into your time & billing program when you finally get back to the office.  Even if you do remember, you may have forgotten the exact amount of time, so you round down just  to be safe.  Stop losing time and money!  Add a time & billing module to your PDA to log your time as soon as completed.  Software modules are available for common programs such as PCLaw, TimeMatters, Carpe Diem, TimeKM, Tabs3, Juris, Omega Legal, and Timeslips.  These add-on modules allow you to enter your billable time anywhere, anytime, then automatically transfers all time entries through your wireless device (Blackberry, etc.) or when you hotsync your PDA, to your time & billing program.  Each of them run about $100, so you'll earn back your investment the first time you use it!   

LexThink Chicago

I am honored to be one of the invitees to the first LexThink! Conference on April 3 in Chicago.  LexThink is the brainchild of blawgrepreneurs, Matt Homann and Dennis Kennedy.  The invitation sets the tone for this first-of-its-kind conference:

Fifty dynamic and innovative “big thinkers” from the worlds of law, business, design, marketing, and technology will join together in a unique collaborative brainstorming enterprise with a single purpose:  to build the perfect professional services firm.  Utilizing the Open Space method, we will turn the Catalyst Ranch space in downtown Chicago into our laboratory as we create and test ideas that will transform the delivery of professional services to an increasingly sophisticated and informed clientele.  By mixing targeted presentations with small group discussions and collaborative brainstorming exercises we will make this the single most productive and thought-provoking day you’ve spent thinking about your business. By the end of the conference, everyone will take away the sum of the accumulated knowledge “produced” during the day.  You’ll have an unprecedented opportunity to network with bloggers, authors and speakers who have motivated and challenged you over the years and who share a high-level passion for their business and their life.

Justice Oliver Wendell Holmes would applaud Dennis and Matt's efforts: He knew that "man's mind, once stretched by a new idea, never regains its original dimension."  I'd say that's pretty good company.

Add a Legal Fee Calculator to Your Website

North Carolina family lawyer Lee Rosen has something other lawyers should envy: A legal fee calculator on this website.  Any potential client visiting his site can answer Yes or No to eight simple questions, then click a button to reveal a well-defined fee range if the matter can be resolved before filing suit.  Click another button to get a range if the matter involves litigation. 

I just love this idea.  I loved it so much when I heard about it several years ago, that I suggested the story idea to the ABA Journal.  They wrote a great story, and I thought fee calculators would pop up on lawyer web sites all across America. However, a quick search on Vivisimo, reveals only a handful of U.S. law firms have followed suit. 

To me, this is a lost opportunity to capitalize on one of clients’ biggest fears:  uncertainty over legal fees.  Many clients make purchasing decisions based, at least in part, on cost.  If they think you are going to be too expensive, they will remove you from consideration.  If your fees are within range of their expectations, you will at least be one of the finalists in their lawyer search. That is why allowing a potential client to obtain fee information prior to an initial consult is such a great idea.

According to Lee, the simple part was designing the eight questions and writing the functional computer code to add to the web site. It took his IT person just a few hours to make it happen. The hard part was developing the dollar value for each question in the fee calculator; Lee and his staff invested dozens of hours to review prior files and client bills to create the range of fee estimates used in the calculator.

Lee has a family law practice, and having practiced family law for nine years, I know how hard it is to provide divorce clients with an estimate of fees.  However, by investing time in reviewing a cross-section of client files and bills, Lee was able to identify key cost-drivers in client bills, develop fair ranges for each stage of the litigation, compare gross assets to gross fees, and translate that data into an understandable format for potential clients.

It may seem daunting at first, but try this: Print out the full bills of four or five representative clients over the past several years.  Compare them.  What are some similarities and differences?  What conclusions can you draw?  It is just a start, but it may be enough information to spur your firm into further action.

This is a significant investment of time for any lawyer in any type of practice.  However, such an investment is sure to pay off if the calculator is incorporated into your marketing efforts.  If you add a fee calculator to your web site, promote it in other marketing efforts.  Inform potential clients that you are trying to provide some certainty in an uncertain world; that you are empowering your clients to have greater control over their potential fees.  Use it as a way to distinguish your firm or practice in the marketplace. 

Lee knows his investment has paid off:  Fewer potential clients are calling, but a higher percentage of the ones that do call end up retaining his firm. More clients, no more wasted initial consults, fewer misunderstandings about fees.  That is what I call a return on investment.

All Work and No Play...

You may have noted that I added a new feature just below my blog roll. Yep, games and diversions!  Taking a quick break during a long work day is good medicine.  Seriously.  A five-minute break to laugh and recharge is recommended by 4 out of 5 psychologists who chew gum. There are all sorts of diversions on the Internet, but few that are fun, clean, and secure.  I’ve listed a few that strike me as fun and, in most instances, innovative.  So have fun, then get back to work!  Note too, there's room for a few more, so feel free to e-mail me with your favorites.

Techshow Early Bird Registration Ends Friday

Friday, March 4 is the last day for early bird registration to the ABA Techshow.  Techshow is the single best opportunity to learn more about legal technology.  Whether you believe you are a technophobe or have "CIO" on your business card, Techshow is the place to be March 31-April 2.  Technology is now an indispensable part of practicing law, and spending a few days each year to learn from the top technologists in the U.S. and Canada is a worthy investment in your firm.  An added benefit is that it's also a great place to network with lawyers from around the country.  Business is business!