What do you do about a disgruntled client who doesn’t want to pay the legal bill he or she has racked up?
Tread carefully. Rightly or wrongly, a fee dispute can open the doorway to a complaint about your professionalism or allegations of malpractice. Once the state bar gets involved, you may spend more time and energy defending yourself than the original bill was worth — and the resulting increase in your liability insurance premiums can also be a burden.
At the same time, you naturally can’t afford to let clients just ignore their bills. The wisest course of action, then, is to try to avoid fee disputes in the first place. Here are some tips that can help:
1. Make sure you have a clear agreement
Remember: Certain legal specialties aside, most people who hire an attorney are doing so for the first time. They aren’t going to be familiar with how the billing process works.
Explain how your fees work, including the retainer. Make sure that your client understands how quickly you may go through that retainer and what you expect from the client when that happens.
2. Choose your clients carefully
You have a right to be discerning about your clients. If you suspect that a client isn’t being realistic about the costs associated with his or her case, it may be wise to take a pass.
Similarly, if your client is unrealistic about the possible outcomes of a case, you may want to decline to provide your services. Clients who have unreasonable expectations about an attorney’s abilities are the most likely to cry “malpractice” later.
3. Keep a steady billing cycle
A client who gets a large, unexpected bill is likely to be an angry client. Make sure that you bill for your services regularly. Itemize your work as much as possible so that your client can see what you’ve been doing and where the money has gone.
Keep clear records, including copies of pleadings and notes on your phone calls or other actions on behalf of your client. If a fee dispute does happen, you need that evidence to be readily available.
If an aggrieved client does take a claim of malpractice to the bar after a fee dispute, make certain that you respond promptly to the letter you receive from the bar — otherwise, your troubles could amplify unnecessarily.