Wisconsin
Lawyer
Vol. 81, No. 8, August
2008
Communicate Consistent Expectations about Payment for Services
by Brenda A. Majewski
The expectation of payment for services rendered by a law firm for
its clients should
begin during the new-client intake process.
The written fee agreement between the lawyer or law firm and the
client is the first
opportunity the lawyer has to state the terms and expectations for
payment for services
rendered. While some lawyers may find the discussion of fees
distasteful, the majority of lawyers are
in business to collect fees for services rendered. Besides the written
fee agreement,
verbal communication between the lawyer and the client is another key
component in getting
paid. Supreme court rules require the lawyer to "maintain
communication with a client concerning
the representation."
The client should know how often he will be billed, what items
he will be billed for,
and what the firm's expectation for payment will be. Rates for
paralegals, associates, and
partners should be differentiated. The client should be given an
estimate of a total bill,
and scenarios that may require charging of higher fees should be
discussed. SCR 20:1.5 (a)
states that a lawyer shall not make an agreement for, charge, or collect
an unreasonable fee or
an unreasonable amount for expenses. Making a client aware of the
professional code of
conduct that lawyers must abide by is a good communication tool also.
If slow payment is a concern to the lawyer or law firm, a
decision to offer discounts
based on fees paid within a certain timeframe may encourage speedier
payment. A client should
never bear the expense of "training" a newer lawyer. Some
hours are not recoverable by
billing. Remove those items from a fee invoice before it is presented to
a client. Regularly
issue bills or billing statements during the representation; a bill is
also a tool to
communicate with your client.
If an initial retainer is paid, the fee agreement can state at
what point additional
funds will be required. If the firm maintains an "ever green"
policy and bills whenever a
retainer balance goes below a certain amount, the client should be aware
of that practice. The
client also should be aware at what point the firm would seek more
drastic measures such as
withdrawing from representation for nonpayment, with the firm following
all of the requirements
necessary.
Supreme court rules also identify resolutions for attorneys
whose clients dispute the
application of advance fees received. Instead of spending additional
hours that could be
billable elsewhere, it may be more beneficial to review the dispute that
the client is questioning
and to settle the dispute through arbitration.
If you have taken all of the above preventive measures to
preserve good client
relations, and maintain proper billing procedures within your firm, and
the client still has an
issue with the bill presented, you have some additional considerations
before determining if
your billing needs an adjustment, or you need to turn up your
negotiation skills to stand by
your bill. Is this likely to be a one-time association with the client?
Is this client likely
to refer additional work? Is this the first billing concern raised in a
longstanding
relationship? Those answers might indicate whether a discount should be
applied. For the
scenario posed, asking why the client is seeking a discount may be an
opportunity to ask for
additional work if the fees charged are reviewed.
Wisconsin Lawyer
