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Presentations:Last update: 04/29/08 Our 15th Year
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The Client's Bill of Rights™
1. Clients Are Entitled To Respect
2. Clients Are Entitled To Control
3. Clients Are Entitled To Competence
4. Clients Are Entitled To Attention
5. Clients Are Entitled To Loyalty
6. Clients Are Entitled To The Truth
7. Clients Are Entitled To Efficiency
8. Clients Are Entitled To Budgets
9. Clients Are Entitled To A Fair Written Agreement
10. Clients Are Entitled To Reasonable Bills
Lawyers are not very popular these days -- even less than usual. From their perspective, this is the result of bad public relations, so they have mounted a campaign to educate the public about the value of lawyers in general to society. Yet the public's perception has not changed, probably because that perception is built upon millions of individual encounters with lawyers, not just upon broad stereotypes about them. It is in those individual encounters that clients feel powerless and abused, even though the law tells them that they are masters of the lawyer-client relationship. The Client Bill of Rights is designed to inform clients, and to remind lawyers, of those fundamental obligations of lawyer to client.
Included in the list are the basic responsibilities that any agent has to his or her employer, like control, loyalty, and truth. I have added several from professional ethical codes, like competence, attention, and reasonable bills. I include several derivative rights that are crucial to managing lawyers and legal fees, like efficiency, budgets, and agreements. Finally, I added respect, which should be a matter of common courtesy.
Proper client control of the lawyer-client relationship requires balance, not tyranny. Clients must still rely on their lawyers' special skill and not discourage lawyers from using their best efforts.
1. Clients Are Entitled To Respect
The rudeness and arrogance of lawyers, even toward clients, are common complaints. According to a story in the San Francisco Chronicle, their absence undid a New Yorker's attempt to impersonate a lawyer. It seems that this gentleman had practiced law without a license for quite some time. An assistant district attorney observed, "I should have suspected he wasn't a lawyer. He was always so punctual and polite."
Many client complaints could be avoided if lawyers would simply treat their clients with common courtesy. Being late for scheduled appointments, failing to return phone calls, failing to keep the client abreast of developments in the case or transaction, and other discourtesies are routine for many lawyers. The subliminal message is that the lawyer's time is more valuable than the client's and that the lawyer will decide what the client needs to know. Lawyers often callously ignore the fears, disappointments, and confusion of their clients, thereby contributing to client dissatisfaction not just with that lawyer, but with the entire legal system: "It is precisely because of the unique role of law and lawyers in American life that a significant advance of arrogance, unruliness, greed, and cynicism in the legal profession is of more concern than similar developments in, say, banking or dentistry," according to Harvard Law School Professor Mary Ann Glendon in her book A Nation Under Lawyers.
Lawyers call themselves professionals to imply that they are better than a mere business person professionals answer a loftier calling. This affectation of superiority infects the client relationship, with the client being made to feel inferior or less intelligent. Yet lawyers who take themselves so seriously are often attempting to hide incompetence or inexperience. Pompous, arrogant lawyers are not better lawyers; indeed, their hubris may make them far too near-sighted to be good, let alone insufferable to deal with. Frankly, this arrogance is just an act: Behind the curtain of the arrogant lawyer is an insecure, petty tyrant playing The Wizard of Oz.
The notion that any lawyer is superior to a client misunderstands the implications of calling oneself a professional. Rather than making the lawyer superior, professional status indicates that the professional owes an extraordinary duty to the client. At a minimum, the lawyer owes a client a fiduciary duty the highest duty one person can commonly owe another in the eyes of the law. In this sense, by owing a higher obligation, the professional is more tightly bound to serve the interests of his or her master: the client.
The point is not that lawyers should grovel before their clients, but that they should approach representation of others by recognizing that they are servants, not masters. They may be better educated, busier, and wealthier than their clients, but they need not act as though they are therefore superior by definition they are not. And because they are clearly not superior, they should also show their clients respect, if not out of common courtesy, then in recognition of their subservient status.
If common courtesy and legal duty are not enough to convince lawyers to treat clients with respect, then business practicality should suffice. In other business fields, movements like Total Quality Management (or TQM) emphasize that even huge corporations must cater to their customers by listening to them. Traditional barriers to competition among lawyers are crumbling, and there are too many lawyers with too few clients, especially paying clients, to go around. Clients should recognize that plenty of competent lawyers are eager to handle even routine matters for several hundred dollars in fees some of these lawyers might also be smart enough to be courteous as well.
Regardless of whether lawyers are motivated by common courtesy, legal duty, or competition, clients are entitled to their respect.
2. Clients Are Entitled To Control
Although having all lawyers respect their clients would be a major accomplishment, the next step, though just as obvious, is even more difficult to imagine. As an agent of the client, the lawyer is legally under the client's "control," but many times the client's control is effectively absent, with the lawyer following the same old groove. Some lawyers believe that they should be in control, an idea, according to Cornell Law School Professor Charles Wolfram, which is based on "paternalism, if not manipulation, that raise[s] serious moral questions." The lawyer's de facto control is effectuated in many subtle ways for a client to take back control, the client must be firm and consistent.
At this point most lawyers would protest that their clients have control, when appropriate. Frankly, unless they are paying close attention to the dynamics of their relationships with clients, they probably do not even realize just how wrong they are. For example, the ethical obligation to negotiate and conclude a settlement only with a client's knowledge of all facts and explicit approval is sacrosanct. Yet lawyers manipulate this situation all the time, in many ways: by deciding when to suggest that settlement talks be opened, by suggesting how to respond to an opponent's overture, by suggesting terms and timing of responses, by using certain tones of voice and patterns of conduct with opposing counsel that may encourage or discourage settlement, by drafting or nit-picking settlement language, and so on. The universal response of clients when their lawyers report a settlement offer is, "Well, what do you think I should do?" That question transfers control, whether the lawyer wants it or not.
Unethical or greedy lawyers paid by the hour can manipulate a situation to prolong a case and thereby increase their fees. Lawyers paid a contingent fee can manipulate the client to take an early, low settlement figure, giving the lawyer a windfall contingent fee before he or she spends much time on the case. (From the lawyer's perspective, a $30,000 fee for doing no work might be far better than a chance at a $60,000 fee in a year or two, after doing $50,000 worth of work.)
Clients must still depend upon their lawyers for advice. Recognizing client control does not mean that the client should override or ignore the lawyer's judgment, nor that lawyers should mold their advice to what they believe clients want to hear: "[L]awyers can often serve their clients best by discouraging litigation, or by deliberating with them about a proposed course of action, rather than by unquestioningly carrying out the client's desires," according to Professor Glendon. Professor Wolfram recommends a "cooperative" or "joint responsibility." Cooperation is fine, so long as the lawyer recognizes who has the ultimate veto.
Sol Linowitz, most recently a partner in a New York law firm and author of The Betrayed Profession, which laments changes in the practice of law, argues that lawyers used to be far more independent, which he misses: "Professionalism presumes that in professional relations the customer is not always right." Yet neither are lawyers always right, and what is "right" may not be all that clear the client must decide. For example, there is no right or wrong when it comes to deciding whether to settle, but the option the lawyer prefers may depend on maximizing his or her fees or discount non-legal factors that are more important to the client. Lawyers can disagree, but it is always the client's option to choose to be "wrong," not to be manipulated to do what the lawyer thinks is right.
Effective client control requires aggressive, timely management of lawyers both fees and the handling of the case. Hiring a lawyer does not mean a client can sit back and relax while the lawyer works.
3. Clients Are Entitled To Competence
Like the notion that clients are entitled to control their legal affairs, the notion that clients are entitled to competent representation would seem to be obvious. Lawyers are ethically required to provide competent representation and to admit to a client when they cannot. Unfortunately, financial pressures on lawyers, combined with lawyer-hubris, dictate that what lawyers say they can do and what they actually can do well are quite different. According to Professor Wolfram:
Clients come to lawyers for help, yet lawyers as helpers to others are only as good as their knowledge, training, and attitudes toward their service function will allow. Clearly, the professional ideal of lawyers is one of great skill and technical proficiency in serving clients. But controversy has raged in recent decades over the extent to which lawyers in fact attain the ideal or even approach it, and, if there are deficiencies, how they may best be cured.
From the client's perspective, finding an experienced lawyer one who has handled a number of very similar matters and handled them well is of paramount importance for several reasons. First, an inexperienced lawyer is bound to be less efficient because he or she will have to learn as the matter progresses. Second, the experienced lawyer should save money not only by having experience, but by having the necessary tools handy, like similar work product, so that documents and research do not have to be started from scratch. Third, an experienced lawyer can avoid pitfalls into which the less experienced lawyer may fall taking a client or two with him. Fourth, an experienced lawyer should have a track record of other successful matters, or at least of cooperation with judges and opponents, that will increase the chances for smooth handling and a favorable settlement or result.
Competence is difficult for clients to assess. Clients are fooled by such things as high hourly rates, media reputation, and firm size. Since the lawyer sets his own rate (and discounts are common), a lawyer's standard hourly rate is a poor indicator of competence. Some lawyers with impressive credentials and experience also have lower overhead, less lavish lifestyles, and more modesty. You can be sure that a lawyer who thinks she is the best in town is very likely to be among the most expensive hourly rates correlate more closely with ego instead of competence. Reputations of lawyers, especially public or media reputations, are also unreliable indicators of the quality of their work. The media rarely understands legal questions so the lawyers it anoints as pillars of the legal community are more likely to be its intellectual stumps. Finally, law firm size correlates with bill size but, perhaps surprisingly, not necessarily with competence. Firm size seems instead to dilute experience and reward mediocrity, indecision, and procrastination.
Though lawyers have an ethical obligation to handle only those matters for which they are competent, most cannot bear to admit that there is anything they are incompetent to handle. Lawyers equate "competence" with "intelligence." In other words, a lawyer who feels that he or she is quite bright are there any lawyers who do not? feels competent to handle almost any matter. Specialization based on experience or advanced training to the degree it exists in medicine, for example, does not exist in the law. In theory at least, all lawyers are generalists, with limited exceptions perhaps for admiralty, patent, or tax law. Much of the money spent on lawyers in each new situation is wasted on turning inexperienced generalists into ad hoc "experts" who make unnecessary mistakes or handle matters inefficiently. Clients with unexpectedly high bills are often victims of lawyers who claim to be competent to do everything, then assign junior lawyers to research every question from scratch, questions that a true expert could answer in seconds.
So long as clients pick up the tab, why would a firm want to season lawyers at its own expense when thousands or millions of dollars can be made through their on-the-job training? The more lawyers learn, the more efficient they might become, yet the less profitable they would be if they bill by the hour and cannot double or triple their hourly rate. Lawyers' haste to turn a profit even from green recruits has all but eliminated the apprenticeship that most lawyers used to serve. Samuel Hoar, managing partner of Boston's Goodwin, Proctor & Hoar, told potential recruits in 1992, "There simply is not enough time nowadays to wait several months until someone matures enough to be a decent lawyer." Several years should be more like it. Intelligence alone is not enough nor is experience alone always enough. Competence requires both, as should the client.
4. Clients Are Entitled To Attention
Showing respect for a client requires courtesy and sensitivity, and giving a client control requires recognition of that control fairly passive or reactive qualities. By contrast, giving clients attention requires the lawyer to take the initiative in handling the matter. It is not enough for the lawyer to open a file, cash a retainer check, and then wait for the client or someone else to push the lawyer to do something. Even with a respectful, competent lawyer, who acknowledges the client's control over the matter, if the lawyer fails to spend time and attention to move it along, it can languish for months and years. Thus, the client at best steers a legal matter, but the lawyer must put the matter in gear and keep its engine from stalling.
Even if no statute of limitations expires or the client has no particular deadline to meet, dragging matters out tends to make them more expensive and increases the psychic wear and tear on the client. For what they're worth, legal ethics rules require prompt attention to a client's matter. By agreeing to represent the client, a lawyer implicitly guarantees that she has the time to handle it and will give it proper attention. These ethical minimums are too often breached by lawyers who refuse to turn any paying work away, but who cannot keep up with their workload, either because of poor work habits, over-commitment, or inefficiency.
Clients can usually tell when their lawyer is not paying attention, but they hesitate to complain. While clients should manage their legal matters actively, and cooperate with counsel, they procrastinate or may seem uncooperative because being involved in legal matters is just about as unpleasant as being diagnosed with cancer. And, as they would if confronted by a diagnosis of cancer, many clients enter a state of psychological denial rather than meet the legal problem head on. Therefore, the burden is on the lawyer, not the client, to attend to the matter. A good lawyer has to prod a client to overcome this inertia or work around it so that the matter can be handled properly, in spite of the client's reluctance. This is not a license for the lawyer to churn the matter, but an admonition not to abdicate responsibility.
The client wants and should expect the lawyer's best efforts. Instead of a lawyer whose level of attention is calculated narrowly to avoid malpractice liability, the client is best served by a lawyer who is actively looking out for the client's interests. In terms of current clichés, the client wants a proactive lawyer, not a reactive lawyer. This does not require the lawyer to bill more time, just to keep her eyes peeled and move the matter along, rather than expect it to move itself along.
5. Clients Are Entitled To Loyalty
Lawyers agree that they owe clients loyalty; this is part of their duty as an agent and fiduciary. Moreover, ethical rules prohibit conflicts of interest, which is supposed to guarantee loyalty. There are two overwhelming problems with this system: Lawyers have a financial interest in defining conflicts too narrowly, and the mechanism for detecting and resolving conflicts is in the control of the lawyers who thereby stand to lose business. At their best, self-policed ethics rules are limited guarantees of loyalty, or, more accurately, imperfect guarantees of limited loyalty, with enforcement dependent upon the willingness of lawyers to go out of their way to forego business.
As with the necessity for lawyer attention, discussed above, the problem with lip-service loyalty is again that, from the client's perspective, meeting the minimum requirements of ethical duties is not sufficient. The client's interest is in having more than the minimum permissible loyalty. Too often lawyers resolve all doubts in their favor so that they do not have to forego lucrative new cases. Sol Linowitz observed, "Now conflicts sometimes grow so serious that courts must remind lawyers that the [lawyer-client privilege] exists to benefit the client, not the lawyer...."
Aside from the incentive for lawyers to construe conflicts rules narrowly to expand their business, the greatest problem with how lawyers handle conflicts of interest is that most clients never even know when a potential conflict exists. Only the law firm knows who else it has represented. Under the current system, lawyers with a financial interest in avoiding disqualification are given responsibility to spot potential conflicts, then to resolve all doubts in favor of their client, and finally either to withdraw voluntarily or to obtain informed consent to the conflict from all interested parties before proceeding.
While honest firms make a good faith effort to screen obvious conflicts, by defining conflict situations as narrowly as possible many very real problems may be lurking without the client ever knowing:
- Would a client care that the firm used to represent the opponent on unrelated matters?
- Would a client care that several lawyers elsewhere in the firm are simultaneously representing a division of the opposing company on another matter?
- Would the client care that the firm had recently represented parties taking positions directly opposite to that which the client now asks them to take perhaps in the same court?
- Would the client care that the firm had recently lost a big case to the opposing firm?
Every client is saying "You bet," and every lawyer is saying "None of their business" because these are not within the narrow definition of conflicts used by many lawyers. Some of these situations present conflicts of interest or divided loyalties, including conflicts not between interests of two clients, but between client and firm interests. Other situations present problems that, because they are not conflicts of interest by any definition, are outside the scope of the lawyer's duty to disclose no matter how much the situation handicaps the client's case. Yet a lawyer who is truly loyal should disclose every potential impediment to a potential client's case, especially those inflicted by the choice of lawyers.
There are plenty of lawyers to go around: Find one whose only interest is in serving the client, without distraction or handicap.
6. Clients Are Entitled To The Truth
Clients are entitled to the truth this is at least as fundamental as loyalty, attention, respect, and competence, right? Unfortunately the forces of self-interest and ego again combine to cause some lawyers to bend the truth. The problem starts in law schools, where fledgling lawyers are discouraged from thinking that there is anything certain about the concept of "truth." Through semantics and logic-chopping their naive notion that the law is dedicated to discovering or serving truth is belittled and eventually suppressed. The job of an advocate representing a client, they are taught, is not to serve truth, but to represent the client by controlling the definition of what is relevant, emphasizing helpful facts, de-emphasizing less helpful facts, arguing for favorable legal constructions, and so on everyone involved in the process has a different idea about what is true and relevant. The assumption is that while the parties are tugging back and forth on reality, truth will miraculously reveal itself to the judge and jury.
In the words of Professor Wolfram, "Lawyers are not necessarily attempting to persuade the fact finder to find the truth; they attempt to persuade the fact finder to find facts favoring their clients." Lawyers are admonished by ethical rules and perjury statutes against bending reality too far, but there is plenty of room left for creative re-interpretation.
Recognizing that bending reality, without breaking it, is what lawyering is often about, it should be no surprise that some lawyers have a hard time turning off these truth-twisting mechanisms when they deal with their own clients instead of opponents. Unlike relationships with opposing counsel, courts, and other outsiders, the lawyer's relationship with the client must, however, be totally, unconditionally, even abjectly, truthful and honest.
All doubt must be resolved in favor of telling the client everything, every nuance. Most importantly, the tendency to suppress, shade, or spin information, for whatever reason, must not interfere. Good news and bad news, plus doubts, hunches, suspicions, and fears must be passed along. Advice as well as facts must be complete and truthful, not manipulative. Paternalistic tendencies to shield clients from the full impact of the truth are born of arrogance, not professionalism. Lawyers who avoid telling the truth because it would mean turning away a juicy chunk of fees let their arrogance feed their greed.
Timing is also critical. Delaying the delivery of information, perhaps in the hope that bad news might turn to good or because the lawyer is too lazy to let the client keep up with the case is just as bad as withholding it. Lawyers embarrassed by courtroom failures or mistakes are not the only offenders. For example, lawyers who send every draft by overnight delivery, fax copies of the same documents just to be sure, and have a messenger deliver every document to the other side always seem to be months behind in updating budgets or delivering complete bills so their clients will not see how expensive the case has become.
Of course, when lawyers shade the truth to obtain new business, hide mistakes, or fudge their bills, their personal interest is in conflict with their responsibility to their clients. Obtaining prompt and accurate information from their lawyers is the only way clients can exercise control:
"When attorneys are employed, they must be paid, and their charges are not always regulated whether by their abilities or their services to a client, but by their own desire to make as much as they can. This evil can only be remedied by making their clients well informed on common subjects, and able to see what course they are taking in matters of more intricacy."
This advice comes from Every Man His Own Attorney, a guide for clients written by Thomas Wooler in 1845. The advice is still good today.
7. Clients Are Entitled To Efficiency
In the good old days, according to Mark Stevens, author of Power of Attorney: The Rise of the Giant Law Firms, firms were "Free to conduct their affairs as they saw fit, [so] the established practices could all but ignore such boorish concerns as efficiency, productivity, ... and competition." While lawyers should agree, at least in principle, with just about every other element of the Client Bill of Rights, a client's right to efficiency may be the most controversial item. Lawyers have lots of ways to rationalize their aversion to efficiency, but their tendency to rationalize and quibble with everything is one reason they are so damned inefficient.
Traditionalists like Sol Linowitz, former partner in a large law firm, claim that "nowhere is any lawyer obligated, by law or by bar association ethical standards, to represent a client in the most cost-effective way." Actually, efficiency is required, though most lawyers ignore it. An ABA ethics opinion states, for example, that "the lawyer is expected to complete...projects for a client efficiently." Besides, as we noted frequently already, ethics and laws establish minimum boundaries, not optimums: You can't win a golf game just by keeping your ball in bounds; you have to get it in the hole in the fewest strokes. Efficiency, in terms of achieving acceptable quality at minimum cost, is the highest priority for cost-conscious clients. Even clients less concerned about cost should be concerned about efficiency because inefficient counsel may also be disorganized, confused, or inattentive to the things that matter.
Why is law the last profession to automate things like research and filing when the technology has been around for years? Why are the biggest firms, the ones that supposedly set the standards for the industry, often the least automated? These questions can be answered with another question: If you were being paid by the hour, what incentive would you have to invest in efficiency?
Hourly billing does not reward efficiency, whether it is efficiency generated by new technology or efficiency from having an experienced, get-to-the-point lawyer handle the matter. Lawyers who find elegant solutions and go home early every day are not rewarded with partnerships they are shown the door. It is far more common in most firms to revere the legendary guru who can make the most simple question into a morass of thorny, though insignificant, questions.
For short-sighted law firms the math is simple: Computers, for example, are capital expenditures that cannot be billed to clients separately (although some firms have tried by charging for word processing or mark-ups over actual cost for computerized legal research). Buying a computer thus hurts the firm's bottom line in two ways because (1) its cost can only be passed through by raising hourly rates, which cannot be raised too dramatically, while (2) the computer will be decreasing the time it takes to perform certain tasks, putting even more pressure on the firm to raise hourly rates to make up for the new, efficient computer. (The most powerful computers in many firms are the billing or accounting computers turning out bills quickly is in the firm's interest and eliminating non-billing clerical jobs saves money.)
Ironically, most firms now use computerized legal research systems, but these often increase the net fees and expenses. Why? Because law firms do not use computers to replace old-fashioned paper research, they use them in addition to paper research. The new computer tool merely becomes another step at the end of an ever-growing series of research steps that tend to prolong the process. Sol Linowitz admits that "The power that office automation has given to lawyers has been focused not so much on reducing costs to clients as on expanding the definition of the work that can and should be done for them."
Technological backwardness is not the only inefficiency cherished by lawyers. Another is the inefficiency caused by hiring the wrong lawyer, but not knowing it, because the lawyer is not licensed to handle the matter. The prior discussion of competence highlighted the inefficiency clients suffer when they hire someone with insufficient relevant experience. A variation on the competence problem arises when the client hires a lawyer in one jurisdiction to handle a case in another. That client will pay more, not only for travel time and expenses, but for the cost of another lawyer (known as local counsel) who is admitted to practice law in the jurisdiction, plus on-the-job training and research of local legal issues that the right lawyer would know immediately. These geographic inefficiencies can add fifty percent to a bill.
Some lawyers may market themselves by emphasizing their commitment to efficiency, but it is ultimately up to clients to select efficient lawyers and to monitor them closely enough to make sure that they do not wander off the track whenever they hear the siren call of the billable hour.
8. Clients Are Entitled To Budgets
Up to this point, the Client Bill of Rights has concentrated on conceptual entitlements of clients. Now the Bill of Rights changes its focus to several tangible tools that will facilitate its implementation. The first of these is a budget. A good legal fee budget really has two components: A detailed plan of action and an itemized list of what each step to accomplish that plan will cost. As bills are issued, they must be reconciled with the budget, and discrepancies explained by counsel. Budgets must also be updated as the picture changes.
Clients should, of course, take budgets and plans with a grain of salt. They can be manipulated, ignored, deified, or divorced entirely from reality, if the planning system is corrupted. With lawyers a common corrupting influence comes from their view of budgets and plans as non-binding sales tools. Lawyers may estimate or budget their fees for a client as a means to "underbid" the competition, but their budgets are often so ill-conceived or irrational that the only one fooled is the client. And lawyers who will give even these flawed budgets and plans are the exception most lawyers will not even attempt to estimate or budget fees, claiming that neither the path nor the cost of legal matters can be predicted. They expect the case to run itself: If they are unwilling to look ahead, they definitely cannot tell where the case is going. These lawyers, you see, do not realize that the whole purpose of budgeting and planning is to force people to spend a little time thinking about what they propose to do before they commit to doing it lawyers prefer to follow their nose wherever it leads, at client expense.
Outside the legal profession, there are people who not only prepare budgets for situations less predictable than legal proceedings, but who have to live with those budgets even if things change. In building construction, companies spend thousands of dollars just to prepare bids, and it is the lowest bidder who usually wins. Obtaining the contract is just the beginning, however, because then the work has to be performed. Whether the successful bidder is also a profitable bidder depends in part on whether the estimates used to prepare the bid were sufficiently psychic the contractor usually assumes the risk, for example, of hidden site problems, increasing material and labor costs, the weather, and so on.
Compared with this array of uncertainties, the cost of most legal projects is much easier to estimate ever hear of a will being rained out? In litigation or negotiation, where adversaries or judges can disrupt one side's plans, there are still plenty of ways to estimate the likelihood of such disruptions and to plan with their likely impact in mind. Lawyers' excuses that they have no way to predict what will happen indicate that they are either inexperienced or evasive. If all else fails, the lawyer can at least disclose how much similar cases have cost. This creates a dilemma for the law firm: Do they disclose just how expensive all those cases were or do they try to distinguish all of them as being different, thereby proving that they have no relevant experience?
Only slightly better are estimates delivered as part of the initial sales pitch. Some lawyers will give non- binding estimates that are exceeded well before the matter is over. Non-binding estimates that are unrealistic are no better than the patter of a used car salesman. Other lawyers will agree to give a budget, but only once they have been selected to handle the case and spend several weeks or months getting familiar with the case. This is as good as no budget at all because it comes too late for the client to switch counsel.
Another variation on the budget game is to ignore it or use subsequent events as an excuse to jettison the budget the first chance they get. An initial budget is imperative before hiring counsel, but the budget and the planning that goes into it must be regularly updated. Better yet, with each month's bill, the firm should reconcile the bill to the budget in other words, show how well the budget is being followed as well as revise the budget to account for the latest events. The budget and bill thus become an integrated tool for managing the case, giving both client and lawyer instant feedback on how well the financial side of the matter is going.
9. Clients Are Entitled To A Fair Written Agreement
Ethical codes and common sense admonish lawyers to reduce their fee arrangements to writing, yet many do not and many who do create egregiously lop-sided agreements unfavorably to clients. Sophisticated clients know, however, that the agreement is the best way to put the lawyer on notice of what the client expects. The best way to implement many of the other points in this Bill of Rights, and make them legally binding, is for them to be memorialized in a written agreement signed by the lawyer, but written by the client.
Ironically, lawyers who preach to client after client the importance of getting everything in writing often fail to practice what they preach. This is fine so long as everything goes smoothly, but if the client's or lawyer's expectations are ever disappointed, the absence of something concrete in writing only makes the dispute fester. Courts will enforce an oral or implied obligation to compensate a lawyer without a written agreement, but the dispute is guaranteed to be quite ugly.
Having no agreement would be better, however, than signing the agreement many firms slide across the table for the new client's "routine" signature. "It's our standard agreement," they'll say. "Why bother to read it, if you really trust us," is what they imply. These agreements are designed not to establish a relationship of trust and respect, but to cause the client to waive virtually every protection normally provided to a client by the law and ethics rules. Next time a lawyer asks you to sign his firm's "standard" retainer agreement with lots of one-sided language favoring the firm, ask him this: "As my lawyer, my trusted advisor and protector of my interests, would you advise me to sign this agreement if someone else had given it to me?" If that does not shame him, then try this: "Would you sign it if you were me?"
Common terms in these agreements include payment of high interest rates, large retainers, personal guarantees by corporate officers, waivers of unidentified conflicts of interest, advance permission for lawyers to withdraw if there is any question about a bill, consent to an inconvenient jurisdiction to resolve billing disputes, and unfettered vesting of staffing and management discretion in the lawyer. Savvy clients simply ignore these agreements and never sign them.
A reasonable agreement, one that is fair to both sides and accurately describes what the parties expect of one another, is not a tool for taking advantage of one another, but for confirming, in a legally enforceable way, those expectations. Its greatest value is not its enforceability, however, but the peace of mind it should give both parties.
10. Clients Are Entitled To Reasonable Bills
The tenth and final element of the Client Bill of Rights is, fittingly, the bottom line. For most clients this is a necessity. Those exceptional clients who believe that money is no object mistakenly assume that legal fees will bear some proportional relationship to the value or amount at stake. If it is a very important matter, a client will be willing to dig deeply, but lawyers are famous for exceeding even unlimited budgets set by those who thought they had plenty of money. No matter how desperate the situation, paying no more than a reasonable fee for necessary services is always the objective, unless the client knows lawyers who are willing to work for free once the client's money is exhausted.
Even when lawyers are working efficiently and following realistic budgets, there is no guarantee of proportionality between what legal services cost and what they are worth, especially when lawyers are paid by the hour. The American Bar Association has said that "One major contributing factor to the discouraging public opinion of the legal profession appears to be the billing practices of some of its members." The ABA notes that the public perceives "that pressure on lawyers to bill a minimum number of hours and on law firms to maintain or improve profits may have led some lawyers to engage in problematic billing practices." (ABA Formal Opinion 93-379.)
Pyrrhic legal victories have been common for centuries: "I was never ruined but twice once when I lost a lawsuit, and once when I gained one," lamented Voltaire. Abraham Lincoln pleaded with potential clients to "Discourage litigation. Persuade your neighbors to compromise whenever you can. Point out to them how the nominal winner is often a real loser in fees, expenses and waste of time."
A reasonable bill refers not only to the amount, but to how and when the bill is delivered. In other words, clients are entitled to prompt, understandable, and accurate bills. Many bills are late, indecipherable and incomplete, and many contain mistakes. Beyond clerical or honest mistakes, there are also too many instances in which a lawyer is under pressure to pad his or her real time, perhaps to get a bonus that depends upon how much he or she bills or to meet a 2,000 billable hour quota. No one is looking over lawyers' shoulder when they write down their time, so succumbing to the pressure to inflate time is easy. Inflated time is also easy to hide who will challenge whether it took six hours or seven to research a brief? Finally, inflated time adds up quicker on the bottom line than inflated expenses. Billing clients for the cost of an extra 10,000 copies that were never made might net $2,500 or so, but what if somebody wants to see the proof the 10,000 pieces of paper? (Extra copy charges also do nothing to meet billable hours quotas.) In contrast, a lawyer billing $250 per hour has only to add ten hours, which could be sprinkled easily across one month, to net $2,500 for the firm, plus ten more billable hours toward the quota, all with no paper trail.
A much more brazen way in which entire firms have systematically "padded" their bills in plain sight is by turning what used to be overhead or clerical time, that was not billed to clients, into billable profit centers. Thus, paralegals, clerks, or word processors bill up to $100 per hour to make copies, file papers, or type, which legal secretaries used to do for "free" as part of the firm's overhead. By giving these new staff members a different title and a billing rate, they become profit centers instead of expenses. In some legal bills, twenty-five percent or more of the dollars being billed come from these non-lawyer timekeepers.
Some clients are also billed more than others because most firms give discounts or other concessions to a few preferred clients, but not others. Discounts based on business volume or other economies are fine, but they should not be applied discriminatorily any client in a similar situation should get the same discount or benefit. As it stands now, a lawyer (with a fiduciary duty to each client) only gives discounts to clients who ask, with each deal being different in many firms. It is difficult to reconcile hiding this information from any client with the fiduciary duty that is owed to each. Undoubtedly bemoaning this competitive pressure, Mr. Linowitz argues against discounting to any client, agreeing that "other clients may well feel that they are entitled to similar consideration with respect to the bills submitted to them."
Finally, when a client does raise a question about a bill or expense, the problem should be resolved quickly, with all doubts resolved in favor of the client. Some lawyers are prone to punishing clients who question their bills, perhaps by dragging their feet or by being less attentive to the matter, perhaps by padding the next bill. No lawyer would ever admit to doing this, but most clients are positive it happens and are thereby discouraged from raising billing problems for fear of retaliation. From the client's perspective, there is little point in challenging a bill if the only outcomes possible are either that the lawyer will retaliate, the lawyer will withdraw and leave the client stranded, or the client can complain to a court or bar association composed of more lawyers.
Problems between lawyers and clients are not always the fault of the lawyer, but, where the lawyer is at fault, the problem can often be traced back to one of the problems the Client Bill of Rights would correct.
The Client Bill of Rights is designed to re-align lawyer attitudes and practices so that they fit client needs. The notion that clients are paramount is already a fundamental part of the ethical and legal standards to which every lawyer is supposed to subscribe. Yet the simplicity of the Bill of Rights masks its power. As Mr. Linowitz also feared, "If law firms are willing to remake themselves in whatever shape they consider most pleasing to clients, they may find that clients don't want the traditional law firm at all." Law firms exist to serve clients, not the other way around, so whether traditional law firms survive in that form will depend upon whether enlightened clients familiar with their rights still want them.