My two articles published last week (here and here) on the subject of using fixed fees in family law cases have created a bit of a buzz. Some bloggers, like Grant Griffiths of the Kansas Family Law Blog, agree with me. Mr. Griffiths writes that he has been using fixed fees in his family court practice for over three years, and he agrees with me that this method benefits both his clients and himself.
However, others, such as Daniel Clement of the New York Divorce Report disagree and still advocate the "hourly" billing model for his family law cases. Mr. Clements questions whether fixed fees are appropriate in anything other than "simple" cases, i.e. those that are limited in scope, and he believes fixed fees to be inappropriate in more involved cases. He focuses his concern on the possibility that parties in family law cases might take "irrational and economically untenable positions fueled by emotions."
I probably had the same type of concern before I began handling cases in this manner. However, after using this method for a few years, I can say from experience that it is unfounded. Among other things, I use the following two methods to help prevent this from being a problem in my practice:
- I am very, very selective in choosing which clients I agree to represent. I estimate that I reject approximately one-half of the potential cases that I could accept. I only agree to represent those clients that meet the following criteria: (a) the client’s goals in the case are reasonable; (b) the client is willing to help my office work on his/her case; and (c) the client is someone that I truly want to help. There are other more subtle criteria that I subconsciously apply, and I will admit that a lot of it is done by "gut feeling". However, after doing this for so long and handling so many cases, my gut feeling is right the vast majority of the time.
- In most family law matters, I usually break the case down into different phases, at which portions of the fixed fee will be due and payable. This can be done in different manners, such as by time or by status of the case, but the point is that if a case gets resolved during any particular phase, there are no additional attorney’s fees due. This scenario gives the client incentive to help resolve the case sooner rather than later if a reasonable resolution is possible, but at the same time, the client is protected and knows his total cost if it is not. Having all of this information available to the client up front helps him/her better assess any settlement offers and the case in general as it progresses.
Mr. Clement’s post made me wonder about his thoughts on these questions:
- How does he handle "unreasonable" clients that he is representing on an "hourly" basis? I believe that the problem he references is more with the clients themselves than with the manner of charging for the attorney’s time. Back when I did charge by the hour for my time, I would typically withdraw from the representation if my client was acting unreasonably. I still have that same option available to me now while using a fixed fee, but it is very rare that I have to exercise that option because of my stringent client selection criteria as discussed above. Either way, I do not want to represent unreasonable clients, period.
- Does he agree with the harsh opinion expressed by Robert Hirshon, former president of the American Bar Association, that “[t]he billable hour is fundamentally about quantity over quality, repetition over creativity”? I believe that clients don’t care how long it takes you to produce those results – they only care about the results themselves. I believe that the hourly rate can encourage (or at least reward) inefficiency on the attorney’s part, because the longer it takes to do something, the greater the fee charged to the client. Also, if I were the client, I know that I would feel uncomfortable in effect writing the "hourly basis" lawyer a blank check and hoping that he/she keeps the fees as low as possible.
I challenge Mr. Clement to handle just one case on a fixed fee basis and to then post his thoughts about doing so. I am confident that should he do so, he will quickly see why I am such an advocate of this method. I handled cases on an hourly basis for over a decade, and I can say without hesitation that the fixed fee basis is vastly superior for both attorneys and their clients. I invite others to let me know their opinions on this topic by posting their comments.