For business law information . . .

For business law information, be sure to check out Bluegrass Business Law blog. There is a synopsis of recent case law on the Kentucky tort of intentional interference with contractual relations.

Why I use Counselor at Law rather than Attorney at Law:

Occasionally I am asked why I refer to myself as a Counselor at Law rather than Attorney. It is a sublety that most miss, but it actually encapsulates a key philosophy to my practice. An Attorney is an agent. They go and do what they are told to do by the principal. I remember going to an attorney in my prior life over an employment issue. I really needed to understand what was happening, but this highly recommended attorney told me very little. I later realized that this was because he either: 1) did not know what he was doing so stayed silent to look wise, or 2) said very little to minimize any liability on his part.

Anyway, he went and did what I asked him to do, but I was very dissatisfied with the process because I felt very much in the dark most of the time. I mean for my clients to feel informed. This is one thing a counselor does. They help you understand what you are going through.

Secondly, a counselor counsels. In my example above, I sought wise counsel as well as understanding. This is because I was faced with something outside of my experience. I recognize that it was ultimately my decision to make as to whether or not to pursue the matter, but I needed at least some rough estimates about the expected outcomes would be depending on my decision. So, as a Counselor at Law I take the risk I believe my profession calls upon me to take to explain options and the likely outcomes of each.

Value billing approach

I was excited to come across this post by The Greatest American Lawyer. It reflects very closely my own approach to billing as I described here. I am reprinting his value billing policy here for comparison purposes:

Value-Based Billing Policy
Some of Traverse Legal’s customers prefer to be billed on a time-based system, where hours are tracked and billed to the client at a specific hourly rate. Some cases are best suited for time-based billing. Unlike most other firms, Traverse Legal does not bill for every activity and task associated with the handling of a matter for a client.
The following is a list of items that we do not charge to clients:
· Transmittal letters which do not contain significant legal analysis or recommendations.
· Short phone calls that do not lead to immediate legal work.
· Update or general information calls to or from client.
· Any activity that does not add value to client’s immediate matter.
· Any activity which deals with general information about the client.
· Any activity which does not work towards resolution of the client’s problem.
Things that we do bill for:
· Any activity which provides specific value to a specific client problem.

Once again, only at a solo or small firm could you find this approach.

What you won’t get from a conscientious solo/small firm:

I found this article about the legal bill to Larry Birkhead’s custody fight for Anna Nicole Smith’s daughter. Here’s the essential part of the post:

Opri’s bill serves as a template for what lawyers shouldn’t do when invoicing clients. The bill includes multiple, extravagently priced meals that Opri shared with other lawyers, where Birkhead wasn’t even present. And while presumably, Opri and her colleagues at least talked about Birkhead’s case at these meetings, most clients will wonder how much business is really discussed in the course of a fancy dinner.

Compare this to my own billing practices as I described them here. It is a fallacy to believe that you automatically get higher quality representation with higher fees. What higher fees often mean is higher overhead and inflated billing practices. Opri’s bill to Birkhead is a perfect case in point.

Lawyering and the billable hour

I came across this post by The G.A.L. regarding the downside of the traditional billable hour that most firms use. While G.A.L. is quoting another blogger in his post, here is my favorite quote:

Blind obsession with the billable hour not only destroys the relationship amongst attorneys and staff at a firm but inevitably between the firm and its clients.

I have wrestled with the best way to bill for various matters I have handled. As a rule, my firm foregoes billing on many items customarily passed on to clients by law firms. For example, we do not track and bill long distance phone charges, routine postage, copies, and mileage in our home county and a number of surrounding counties. Because I do not have a billable hour goal set for me, I find myself often rounding down the time I spend on a project rather than rounding up because my tendency is to think about my clients circumstances as much as my own.

I have contemplated using flat fees, and I have done so in some cases where the work involved is fairly predictable. I have also used flat fees in a family law matter simply because the client could not afford anything else. However, the downside to flat fees is that when the unexpected occurs, there is a built in disincentive to going the extra mile and one must consciously resist the temptation to do less.

While I still use time as a measure of cost to the client in most matters, there are various other ways that I avoid the billable hour trap and focus more on the value of the product to my clients. By “no charging” time that did not call upon my education and experience as an attorney, such as brief phone calls that just conveyed simple information, or that add to my experience and marketability, such as basic research in an unfamiliar area of law, I essentially do a form of value billing. However, I think this approach actually goes beyond what is usually meant by “value billing”.

Value billing just means that there is a set expected time it takes to prepare a certain document. For example, 1/2 an hour to draft a motion to compel discovery. A new associate may take an hour but only bills for 30 minutes while a seasoned attorney may do it in 10 minutes but bills for 30. Instead, I like to think my approach encapsulates value added to the client. I suspect there is no perfect solution to this dilemma, but I do know that it is only at a small firm or with a solo where one can find the freedom to experiment with better ways to bill.

Child support typically continues beyond age 18

Check out this post by Elusive Justice regarding child support. As E.J. points out, child support typically continues on through a child’s 19th year as long as they remain in high school. There are also statutory provisions for health care insurance coverage even beyond that. The women E.J. spoke of was trying to save money because she simply did not have funds to retain a lawyer. Unfortunately, that decision will probably cost her far more in the long-run.

This brings we to a point about small firms and solo practices that I very much like. I can give a short consultation to a person like in E.J.’s scenario either for free or a low fee. Even if I charge my hourly rate, just getting advise on that matter would have cost roughly $50 because it would not have taken long. A major savings over the fees she may rack up if the ex-spouse stops child support over the inadvertent agreement.

Anna Nicole’s will contains a gift to all – a lesson in choosing an attorney wisely

Anna Nicole Smith (Vicki Lynn Marshall) had the resources to hire the best lawyer around to draft her will. I would guess that she paid the lawyer drafting her 2001 will very handsomely. However, the language of the will would get a failing grade. Check out this critique by a law professor. Price does not guarantee quality. Interview attorneys before giving them your business and make sure they will give personal attention to the details whether you have many assets or few to leave behind. A few words can make a world of difference.

Sorry for the absence

I was tied up in a hearing regarding a rather intense custody battle last week. I’ve been digging my desk out from under paperwork these past days. I hope to have some new posts soon.

Less is more

This post by The Greatest American Lawyer describes very well why I like being at a small firm.

Having seen both sides of the practice, I have to say that one of the most fundamental flaws of hourly billing firms is the propensity to attempt to service more clients than is reasonably possible. Their drive to ensure that every hour of everyday is billable creates a mandate that everyone needs to be “choking on the fire hose.” When firm business is down lawyers don’t know what do. Many just kick back and relax, try not to say anything that would trigger the next avalanche of workload. Others go out and try to drive new business.

This moment of relaxation where you are not under any stress to have something out by noon is the time during which a lawyer can really be a lawyer. Firms need to be encouraging those necessary gaps in workload where goals can be defined and strategies can be set and executed.

Click here for the full post.

Justice may be blind – but she’s loaded!

The web is alive with news that at least one New York law firm has bumped up the starting salary of their new associations to $160,000.00. See Above the Law for a start. Here is Lexington, Kentucky Stoll Keenon Ogden started their 2006 graduates out around $84k and some change. Stites and Greenebaum are in that range more or less. Then, one drops down to mid-size firms who paid their 2006 graduates about $45k. Lousville firms are paying roughly the same – maybe a couple k more. I checked a cost of living calculator and found that $85k here in Lexington equaled $183k in Manhattan. So, Lexington lawyers in big firms make more that New York lawyers in terms of buying power.

Now, for those of you going to a big law firm, I hope you realize that most of your work will actually be done by one of those brand new lawyers who are just as inexperienced as every other brand new lawyer. While they were the top of their class (or a relative of a partner), the difference in brain power between the tip-top and the rest of the class measured in decimal places.