Why Flat Fees?

“Most good lawyers can work eight or nine hours a day and bill twelve.” 

– The Firm, John Grisham

My father-in-law loves to poke fun of my chosen profession. One of his favorite jokes involves asking how much of my time is getting billed to a client as we play golf, watch a baseball game, or grill burgers in his backyard. He’s a funny guy. Really.

But his teasing raises a valid concern that most people have when they are faced with hiring a lawyer. In an article on her blog, Lawyer Meltdown, Allison Shields notes that “one of the main complaints from clients about hourly billing is that they are unable to budget or to anticipate legal fees.” Other, potentially more serious, problems with hourly billing are:

• it encourages inefficiency
• it provides lawyers with incentive to overcharge
•  it causes frustration for clients who are concerned about the clock ticking for every task the lawyer performs regardless of how meaningful it is
• it discourages clients from spending time talking to their lawyers

All of these issues with “the billable hour” are the reasons I avoid using hourly billing whenever possible.

A flat-fee system for providing legal services can provide the lawyer with more freedom to think outside the box when providing solutions to his clients. It also encourages open communication between the lawyer and his client. It is vitally important to me that my clients feel free to contact me with any questions or concerns they have without having to worry about what a single phone call might cost them. Setting a flat fee for each representation allows that.

In addition, setting a flat fee at the outset of the representation allows the lawyer to engage in more detailed research or writing without worrying about whether the client will balk at the additional expense on his monthly billing statement. The client benefits greatly from this because the lawyer is freed from the concerns about hours and can focus solely on what approach or methods will most benefit the client.
David H. Dunsmuir boils the flat fee system down this way: “In the end, the approach requires little more than the client and lawyer defining a scope of work to be accomplished, and agreeing on the value that will be paid for that work.” The client’s goals become the sole focus of the representation.

I look at it this way: when my client and I sit down to discuss how to best meet their goals, we form a sort of partnership with those goals as the driving force. This approach aligns my objectives with theirs, so we can work together to achieve the best result possible for the client.

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As a part of the weekly blogging I hope to do, I thought it might be fun to include a 'Lawyer Joke of the Week' segment:

Lawyer Joke of the Week:

Q: What’s the difference between a lawyer and a herd of buffalo?
A: The lawyer charges more.

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