December 01, 2004

The Practice of Law -- small rant

What do you think, assuming you are not a lawyer, about what the practice of law is? I think that there are many different images. Maybe you think it is like television, all Ally McBeal or LA Law -- lots of well dressed people running about like idiots and arguing with judges. Maybe you think it is the movie image of Atticus Finch in To Kill a Mockingbird or Tom Cruise in a Few Good Men. Maybe you have the used car salesman image of the sleazy personal injury or insurance defense lawyer. Maybe it is the tweed coat wearing law school professor image or the ivory tower Supreme Court litigator who sits high above and contemplates serious issues. What else? Maybe the grizzled old criminal defense lawyer or the young earnest prosecutor. Maybe the crusading environmental lawyer or the terribly serious public interest guys with the long hair and earrings who still think that smoking weed is consistent with the oath they took upon admission to the Bar.

Reality? Pretty much nothing like the above descriptions. At least, not in my practice. No, in reality, even at the big firms, a lawyer is a small business operator. He sells services to individuals and to companies and then he tries to get paid for them. Some of the services are measured by the amount of time spent performing them and those are charged on an hourly basis. That hourly basis charge is a very expensive way for an individual to purchase legal services, especially the services I provide -- complex corporate litigation and dispute resolution. Litigating by the hour is a terrible way to go, for most. In fact, just out of curiosity, how much do you think my firm charges out my time at? I'll be interested to see what you come up with.

I spend some of my time dealing with the frustration of making sure my clients pay the firm for the services we provided. I do a good job for my clients and usually obtain pretty good results, but there is no guarantee about anything and I have had some bad decisions and bad results. But, those bad results don't mean that the client is relieved of his obligation to pay his bills. And if the client doesn't pay me, what can I do? I can't stop performing services because I am a fiduciary to my client. I can make a motion to the court to be relieved as counsel but that is not a guarantee that I will be relieved. I may be stuck with this client, as I am probably stuck right now, with a client who has a $40,000 plus bill and has not given me anything on it but empty promises and mumbles.

It is annoying to be lied to about your bills.

So, no, instead of thinking of a lawyer as an Armani suit wearing guy who spends his days yelling at judges, think instead of a small business owner who struggles to get paid. And also sometimes yells at judges, if they get lucky.

Posted by Random Penseur at December 1, 2004 10:54 AM

I may not be a good participant here, since my wife is a corporate attorney, but she cites legal services in the LA-NY market as $500 and more per hour.

I'm curious, though: to what extent does an ordinary small businessman qualify a potential client? A realtor, for instance, is going to make some effort to avoid wasting time showing a house to someone who has bad credit or obviously can't pay. Someone who gets embroiled in a lawsuit and then is a deadbeat over the fees ought to have some kind of a paper trail that suggests this might happen. Or no?

Posted by: John Bruce at December 1, 2004 12:38 PM

No fair since I'm a lawyer, but based on rates here in the middle of the country and my knowledge that you're as old as I am, I'd bet you bill out at $600 or more in the New York market.

A great compliment (at least I take it as such) with which I am paid on a regular basis is: "I can't believe you're really a lawyer."

Posted by: JohnL at December 1, 2004 01:40 PM

I think you bill for between $650 and $725 per hour. If you are a junior partner(I don't think you would have hit partner, yet.), you might bill for less in hopes for a larger bonus.
I would also assume that you have to bill 60 hours a week.

Posted by: Azalea at December 1, 2004 02:26 PM

I find those amounts staggering!

It's hard to feel much sympathy for the legal profession when those are the rates they charge for their services.

That said, I can understand the frustration of not being paid for your services, as well. And being forced to continue to provide them. That's gotta suck!

Posted by: Mick at December 1, 2004 02:57 PM

$600 an hour is kind of staggering, I agree. Although I do know attorneys who bill out at that rate. But $750? That is really over the top. No, John Bruce was the closest, although he was just a titch on the high side. Maybe the firm ought to adjust my rates!

That was an interesting question you posed, Mr. Bruce, and I will try to answer it in a post later as opposed to a in the comment section.

Posted by: RP at December 1, 2004 09:44 PM

$16 an hour here.

I'm in the wrong business.

Posted by: Tuning Spork at December 1, 2004 10:03 PM

Well, TS, keep in mind that the hourly charge does not go directly to my bank account but instead to the firm. The charge is what the firm rents me out at. I certainly don't see anything at all like that figure in my check. In fact, when I was a baby lawyer, I ran the numbers once to see what I was actually being paid an hour and was so depressed that I vowed never to perform that calculation again!

Posted by: RP at December 2, 2004 09:48 AM

RP, I just applied the 150-200% premium that seems to reflect the difference in costs between anywhere in Texas and NY City. Most partners in big firms around here bill in the $300-400 range, so I just multiplied by 1.5 to 2.0 and came up with the $600 number. Your point about the money going to the law firm is a good one.

If I ever left in-house practice and stayed with the law, I doubt I would go back to a firm, as I could make a comfortable living undercutting law firm rates and providing GC-for-hire services. I know a few lawyers around here who do just that.

Posted by: JohnL at December 2, 2004 10:39 AM

Well, John, all you'd need then would be someone like me who could provide the corporate litigation side and you'd have a nimble, full service, boutique! Hey, we could be on to something!

Posted by: RP at December 2, 2004 10:49 AM

I mentioned this post to my wife last night, and she was a little puzzled by the implication (as I see it) that you have to do your own collection. She works with a lot of ex-white shoe law firm types from downtown LA, and she doesn't think they have to do their own collections. What's the point of working for a firm if you have to do all your own non-legal work? Or is your firm just cheap????

Posted by: John Bruce at December 2, 2004 11:49 AM

Well, ultimately every lawyer is responsible for making sure that his or her client is paying the bills. This is doubly true at a small firm like the one I'm at. A lawyer who takes on a client and is not involved with the collection side of the relationship, especially if there is a problem, is not cheap, he's stupid. The first time a lawyer will hear about a malpractice claim from a client is when the client stops paying the bills and the lawyer presses the issue. You need to be involved with that process if you were the contact point on the case or transaction. No, the lawyer who doesn't stay involved in the economics of the lawyer/client relationship is exposing himself needlessly to the client and risks having others strain the relationship. It isn't cheap, it is good practice.

Posted by: RP at December 2, 2004 11:57 AM

"Real" Lawyerin defined: Six million hours of tedium followed by six seconds of sheer terror.

That's if you're lucky enough to get to enter a courtroom.

I actually think those rates are pretty moderate; considering the area of the country and firm size/specialization, etc. A lot of it depends on the support staff as well. When I worked for the immigration law firm, we did "flat fee" arrangements and that was the last time I saw those deals. I, for one, LOATHE billable hours -- especially when *I* had to come up with them. Of course, that was my brief stint as LA to a family law/criminal attorney. Sole practitioner. Asshole. He was a great attorney to his clients but a complete and utter jerk to his support staff. And I had more billable hours than HE did.

Don't let this get around but: I actually like those that choose the profession. Mostly. Except the above-mentioned jerkoid. And those like him. The reality is: lawyers are just like everyone else. There are "good guys" and "creeps."

And it's been my experience that you get what you pay for. :)

Posted by: Margi at December 2, 2004 07:09 PM

I think you have a pretty accurate picture of it, Margi, which is not a shock.

I detest keeping track of my time on the hourly billing thing. I am also very bad at it.

Posted by: RP at December 3, 2004 12:18 PM
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