Capturing Legal Costs and Containing the Bill
| Author | Mark Chinn |
| Pages | 4-5 |
4 FAMILY ADVOCATE www.shopaba.org
Most lawyers got into law practice to
help people. Because of that, they are
often reluctant to talk about money.
But clients have a right to know how
they will be charged. Clients should
be forthright in asking lawyers how
they charge and when bills will be sent. Here are the ques-
tions you should ask:
• How do you charge?
• What is your retainer?
• What time increments do you bill in?
• Will I receive a monthly itemization of your fees and
expenses?
• Do you have an estimate of what the case will cost?
(Usually, this is a hard question to answer because lawyers
often can’t predict fees, but the question should be asked.)
• Can I be advised beforehand of signicant expenditures
of time?
Setting Fees
Every state has a Code of Professional Responsibility, which
should show standards for setting fees. You might want to
look such a code up online. Next, nd out what other
lawyers in your area are charging. Consult with close lawyer
and judge friends to see what they know others are charging.
e hourly rates of lawyers often depend on years of experi-
ence and expertise. Look your lawyer up on his website to see
his experience and credentials.
Capturing Legal Costs
and Containing the Bill
By MARK CHINN
Types of Fees
Flat Fee
Prior to the 1970s, the most common method of charging
was probably the “at fee.” en the U.S. Supreme Court
decided that fee schedules were unconstitutional. Since that
decision, and with the growing inuence of insurance
companies, the at fee has faded in prominence. Although
at fees are in use in some areas, lawyers nd them hard to
quote in more complex cases. Many lawyers feel there is no
way to know, at the beginning, what the course of litigation
will be. A case that appears to be all about nances can
suddenly become an intense custody battle. Once the fee is
set, it is very dicult, if not impossible, to change. If you like
the idea of the certainty of a fee, you might see if there are
lawyers who will charge on that basis.
Hourly Fee
e most common form of billing in the divorce world is the
“hourly fee.” Attorneys record their time in predetermined
intervals and charge the client according to the time spent.
e most common intervals are either quarter-hour intervals
or sixth-of-hour intervals. For example, under the quarter-
hour interval method, the minimum charge for any eort is
at least fteen minutes. Under the sixth-of-hour method, the
minimum charge for any activity is ten minutes. A bill might
look like this:
6/9/06 Telephone conference with client 0.25
6/10/06 Receive and review correspondence
from opposing counsel and telephone
call with client 0.50
6/20/06 Receive and review interrogatories,
correspondence to client; prepare
Motion to compel 1.50
Total Time 2.25 × $300 per hour = $675
Contingency
Clients will often hear commercials on TV where personal
injury lawyers advertise that there is “no fee unless we collect
for you.” ese personal injury lawyers charge what are known
as “contingency fees,” where the lawyer takes a percentage of
the amount collected on behalf of the client. State Codes of
Professional Responsibility generally do not permit this method
of charging, except in child support arrearage cases.
Retainers
Lawyers who charge by the hour usually ask for a “retainer.”
is is a sum of money requested at the outset of the case to
serve as an initial fund out of which to pay the hourly fees.
is retainer is placed in a “trust account.” e amount of
the retainer depends entirely upon what the lawyer wants to
obtain upfront to secure payment of his fees. Clients often
confuse retainers as being an amount their case will cost. In
fact, retainers often bear little relationship to the nal cost of
the case.
Published in Family Advocate, Volume 43, Number 1, Summer 2020. © 2020 by the American Bar Association. Reproduced with permission. All rights reserved. This information or any portion thereof
may not be copied or disseminated in any form or by any means or stored in an electronic database or retrieval system without the express written consent of the American Bar Association.
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