Lawyers often send bills that consist of not much more than a notation like this: "32 hours @ $150/ hour = $4,800 now due." You deserve better -- and should demand it.
Scrutinize your bill. Spend some time closely examining a lawyer's bill. Compare your fee agreement to any itemized bill (lawyers sometimes call these "accountings") your lawyer gives you. If your lawyer doesn't give you an itemized bill, ask for one. If you are paying by the hour, make sure your lawyer is charging you as agreed. Because your lawyer wrote your fee agreement, insist that ambiguities be resolved in your favor.
Don't pay all or part of your bill. You may not have to pay a lawyer who quits representing you on the eve of trial, violates ethical rules, or charges you fees considered unconscionable (outrageous). If your lawyer charged you for the time of two lawyers who did the same thing, or charged for compulsively and unnecessarily organizing files, insist that the bill be reduced to a reasonable sum. And never be afraid to ask about questionable or unclear charges; the lawyer may offer to reduce the bill.
If you just can't work out something with the lawyer, consider going to arbitration. Arbitration is an out-of-court procedure for resolving disputes using a neutral outsider called an arbitrator. Most states have voluntary fee arbitration programs, which allow either a lawyer or a client to suggest arbitration.
Mandatory arbitration. You may, in fact, be required to turn to arbitration. In some states -- including Alaska, California, Maine, New Jersey, South Carolina, and Wyoming -- arbitration is required for most fee disputes between lawyers and clients. In New Jersey, attorneys must submit fee disputes to arbitration, although clients have the option of taking complaints directly to court.
In many states, however, it is not legal for a fee agreement to contain a mandatory fee arbitration clause. This is because your attorney, your professional adviser, is ethically prohibited from presenting you with an agreement in which you give up your right to sue the attorney in court. Despite this fact, lawyers are increasingly inserting mandatory arbitration clauses in their agreements. They argue with some plausibility that because arbitration is usually cheaper, faster, and easier than a civil court trial, it's in everyone's best interest.
Binding or nonbinding? Arbitration can be binding or nonbinding. Binding arbitration means you and you lawyer are bound by the arbitration decision -- neither of you can appeal. An arbitration clause in an attorney-client fee agreement usually calls for binding arbitration. In it, you give up the right to sue in court and have your case decided by a jury. In exchange you will get a quick, final result.
Nonbinding arbitration means that either side can reject the arbitrator's decision and file (or continue with) a lawsuit. Arbitration by a local or state bar's fee arbitration panel is usually nonbinding. Beware that in some states, a nonbinding arbitration award often becomes binding and final if you fail to reject the decision within about 10-30 days. In other states, by contrast, you need to take steps to make a nonbinding award binding. For example, you may be required to file a copy of the arbitration decision with a local court.
Choose nonbinding if you have a choice. Unless binding arbitration is required under your agreement or state law, you are usually best off proceeding with nonbinding arbitration. This will give you an opportunity to organize your case and have a practice run before the matter reaches court. And there is always a chance that you and the lawyer will either settle the matter during the process or accept the arbitrator's award.
For detailed information about working with a lawyer, get the ebook The Lawsuit Survival Guide: A Client's Companion to Litigation, by Joseph Matthews (Nolo).
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