Having Problems Getting Paid?
Collecting Your Fees
Within The Line Of Ethics
About MyCase
MyCase is the premier web-based legal practice management
software. Built as a complete platform, MyCase offe...
About LawBiz®
Increase revenue, improve efficiency, and decrease stress with
coaching and consulting from the award-winnin...
About Ed Poll
Edward Poll is the nation’s foremost
expert on law practice management,
focused on helping attorneys and
law...
Law Is Both A Business & A Profession
“Law is not a profession at all, but rather a business
services station and repair s...
Law Is Both Profession & Business
“Law is subject to the same laws of economics as any other
business. Having a great prod...
The Work Cycle
Doing the work
Getting
the work
Collecting your billings
Overview
Collecting your fee – from the start
Dealing with slow payers
When non-payment becomes serious
• Withdraw
• Alter...
Collection BeginsAt Intake
• Understand what client wants
• Seek that result for that client
• Want vs. Need
• “Competent”...
Poll #1
Do you discusstimely payments with clientsduring
engagementsessions?
Fees
• Excessive (ABA)
• Unconscionable (CA)
“Reasonable”underRule 1.5
Types of fees
• Time-based (usually hourly) fees
• ...
Budgets
• Estimate future costs and expenses
• Manage client expectations
• Document likely outcomes
• Memorialize course ...
Bills Influence Collections
• Can the client understand the bill?1
• Value provided?2
• Does the bill make the services so...
Poll #2
Do you have a collectionpolicy?
Who Handles Collections?
• Lawyer involvement
• Staff involvement
- Obligation to supervise
• Need for joint plan and
stay...
Poll #3
Duringthe course of your representation,how often do you
connectwith your client?
Bills Not Paid Timely
• Did client receive the bill?
• Did client understand what was done and what was billed?
• Does cli...
Interest On DelinquentAccounts
• Must disclose possibility of interest fees at outset of
representation
• Some jurisdictio...
Stopping Work
• See engagement / fee agreement
• Impact on client and matter
• Impact on lawyer-client relationship
Withdrawal When Non-Payment
Permitted
under Rule
1.16
Willnot
cause
materially
adverse
effect on
interest of
clients
Time
...
Alternatives To Non-Payment
• Payment plans
• Revisit when client’s finances improve
Avoid an arrangement that the client ...
Lien On Client FilesAnd Property
• Can’t withhold client’s file for nonpayment
• Can withhold much or part of a file to ob...
Reporting Client To Credit Agency
States that reporting is not permitted because the disclosure is
not reasonably necessar...
Promissory Note To Secure Payment
• Fair and reasonable
• Terms fully disclosed to client in (understandable) writing
• Ad...
MandatoryArbitration Clause For Fee Disputes
• Generally permitted under ethical rules
- DC Bar Opinion 218: Arbitration i...
Filing Lawsuit
• Check jurisdiction regulations
• Review E & O insurance policy
- Carrier may want / require notice
• Use ...
Risk Of Cross-Complaints For Legal Malpractice
• Only 10-15% of suits for fees result in cross-complaint
• First loss is b...
SellingAccounts Receivables?
• DC Bar Opinion 298: Outright sale not permitted
• Must use alternative means of dispute res...
Taking Stock In A Client
• Fee must be reasonable
• Comply with Rule 1.8(a)
• Be mindful of potential conflicts
ABAOpinion...
Settlement / Compromise Of Claims
• Agreement should be confirmed in writing
• Release of claims – beware Rule 1.8(h)
• Im...
Poll #4
What do you do whenyour client doesn’tpay you in
accordancewith your payment agreement?
Process Summary
• First meeting
• Engagement letter
• Budget
• Internal collection procedure
• Peer review of file
• Arbit...
Contact Us
Ed Poll, J.D., M.B.A., CMC
LawBiz Management Co.
www.lawbiz.com
www.lawbiztips.com
www.lawbizblog.com
(800) 837...
Thank You
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Having Problems Getting Paid? Collecting Your Fees Within The Line Of Ethics

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  • Case & Matter ManagementTime & Billing (New QuickBooks Integration)!Document Management & AssemblyiOS Mobile AppReportingClient PortalCalendaring & Task Management (New Workflow feature)!
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  • Having Problems Getting Paid? Collecting Your Fees Within The Line Of Ethics

    1. 1. Having Problems Getting Paid? Collecting Your Fees Within The Line Of Ethics
    2. 2. About MyCase MyCase is the premier web-based legal practice management software. Built as a complete platform, MyCase offers features that seamlessly cover all the daily functions that a modern, small law firm requires in one place at an affordable price. AboutMyCase Just $39/month per attorney $29/month per paralegal or staff
    3. 3. About LawBiz® Increase revenue, improve efficiency, and decrease stress with coaching and consulting from the award-winning law practice management expert Ed Poll. LawBiz® offers three coaching options on a 6-month cycle to learn new habits and sustain them. Coaching Programs • Mentoring • Coaching • Immersion Program The BusinessOf Law®:How To BuildYour Practice
    4. 4. About Ed Poll Edward Poll is the nation’s foremost expert on law practice management, focused on helping attorneys and law firms effectively manage The Business of Law®. With over four decades of professional experience, Ed’s extensive background in business and law have made him one of the nation’s most sought-after experts in law practice management. He is the first recipient of the California State Bar (LPMT Section) Lifetime Achievement Award in 2010. EdPoll, J.D., M.B.A., CMC
    5. 5. Law Is Both A Business & A Profession “Law is not a profession at all, but rather a business services station and repair shop.” - Adlai E. Stevenson, Senator
    6. 6. Law Is Both Profession & Business “Law is subject to the same laws of economics as any other business. Having a great product is not enough.” Tower Snow, Chairman (2001) Brobeck, Phleger & Harrison San Francisco Corporate Law Firm
    7. 7. The Work Cycle Doing the work Getting the work Collecting your billings
    8. 8. Overview Collecting your fee – from the start Dealing with slow payers When non-payment becomes serious • Withdraw • Alternatives tosecure payment • Suit or arbitration
    9. 9. Collection BeginsAt Intake • Understand what client wants • Seek that result for that client • Want vs. Need • “Competent” to handle the matter • Want this client / matter Written engagement Letter • Consequences Credit Check SelectingClients
    10. 10. Poll #1 Do you discusstimely payments with clientsduring engagementsessions?
    11. 11. Fees • Excessive (ABA) • Unconscionable (CA) “Reasonable”underRule 1.5 Types of fees • Time-based (usually hourly) fees • Fixed • Contingent • Value
    12. 12. Budgets • Estimate future costs and expenses • Manage client expectations • Document likely outcomes • Memorialize course of action client selects • Makes client part of team
    13. 13. Bills Influence Collections • Can the client understand the bill?1 • Value provided?2 • Does the bill make the services sound meaningful and reasonably priced? 3 • (If billing cycles are relevant) Has the firm sent the bill when client is likely able to pay? 4
    14. 14. Poll #2 Do you have a collectionpolicy?
    15. 15. Who Handles Collections? • Lawyer involvement • Staff involvement - Obligation to supervise • Need for joint plan and staying informed
    16. 16. Poll #3 Duringthe course of your representation,how often do you connectwith your client?
    17. 17. Bills Not Paid Timely • Did client receive the bill? • Did client understand what was done and what was billed? • Does client have any questions or problems with the bill or the services? • When will the client pay? Follow up – “Dial & Smile”
    18. 18. Interest On DelinquentAccounts • Must disclose possibility of interest fees at outset of representation • Some jurisdictions require written client consent to arrangement Generallypermitted but . . .
    19. 19. Stopping Work • See engagement / fee agreement • Impact on client and matter • Impact on lawyer-client relationship
    20. 20. Withdrawal When Non-Payment Permitted under Rule 1.16 Willnot cause materially adverse effect on interest of clients Time sensitivity
    21. 21. Alternatives To Non-Payment • Payment plans • Revisit when client’s finances improve Avoid an arrangement that the client will almost certainly fail to satisfy.
    22. 22. Lien On Client FilesAnd Property • Can’t withhold client’s file for nonpayment • Can withhold much or part of a file to obtain payment • Can withhold only work product • Can withhold only opinion work product • May withhold file even if client prejudiced Checkyour jurisdiction
    23. 23. Reporting Client To Credit Agency States that reporting is not permitted because the disclosure is not reasonably necessary to collect the fee. NYSBAOpinion 684 (1996)
    24. 24. Promissory Note To Secure Payment • Fair and reasonable • Terms fully disclosed to client in (understandable) writing • Advised in writing to seek independent counsel • Signed agreement documenting informed consent Complywith Rule 1.8(a)
    25. 25. MandatoryArbitration Clause For Fee Disputes • Generally permitted under ethical rules - DC Bar Opinion 218: Arbitration is consistent with Rule 1.5 • Generally may not require arbitration of all disputes between lawyer and client - Rule 1.8(h) limits when lawyer may make an agreement prospectively limiting liability
    26. 26. Filing Lawsuit • Check jurisdiction regulations • Review E & O insurance policy - Carrier may want / require notice • Use outside counsel - Objectivity - Better protection for confidences
    27. 27. Risk Of Cross-Complaints For Legal Malpractice • Only 10-15% of suits for fees result in cross-complaint • First loss is best loss • Need to make sure case is one worth sending to suit • Peer review of file before suit is filed
    28. 28. SellingAccounts Receivables? • DC Bar Opinion 298: Outright sale not permitted • Must use alternative means of dispute resolution when possible under Rule 1.5 • Must retain sufficient control over disclosure of information to satisfy Rule 1.6
    29. 29. Taking Stock In A Client • Fee must be reasonable • Comply with Rule 1.8(a) • Be mindful of potential conflicts ABAOpinion00-418permits a lawyerto acquirestock in a client.
    30. 30. Settlement / Compromise Of Claims • Agreement should be confirmed in writing • Release of claims – beware Rule 1.8(h) • Implications for future billing
    31. 31. Poll #4 What do you do whenyour client doesn’tpay you in accordancewith your payment agreement?
    32. 32. Process Summary • First meeting • Engagement letter • Budget • Internal collection procedure • Peer review of file • Arbitration if required • Write-off • Lawsuit
    33. 33. Contact Us Ed Poll, J.D., M.B.A., CMC LawBiz Management Co. www.lawbiz.com www.lawbiztips.com www.lawbizblog.com (800) 837-5880 Get 10% off your first 6 months with MyCase for attending. Use promo code: FEES13 MyCase www.MyCase.com www.MyCase.com/blog (800) 571-8062 support@mycase.com sales@mycase.com
    34. 34. Thank You
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