Tuesday, August 17, 2010
A few years ago I was at a seminar where one of the speakers said "who invented the free consultation?"
The answer is PI lawyers. They take no fees upfront, and are paid nothing unless they recover damages. It's an all risk, some reward practice. It's the closest thing to Vegas in the legal profession. Take on a case for free, and if you win, you get paid. If you lose, you get nothing, and lose what you put in to the case.
Most lawyers though charge an hourly or flat fee. That fee is either paid upfront or in monthly installments based on invoices. That fee is set at the initial consultation.
Long ago, lawyers would routinely charge a consultation fee. Often clients would go see a lawyer simply for a consultation. There was no reason to consult for free, as a few consultations a day would add up to real hours.
It still does today, in an age where the free consultation has become the norm in every practice area. Take the lawyer who charges $250 an hour and does 2 free consultations a day. That's $120,000 in free consultations a year. But lawyers who charge for a consultation are deemed "arrogant" or out of the mainstream.
The sense of most lawyers is that a free consultation is "good business practice" and "gets the client in the door." Many lawyers waive the consultation fee if they are retained on the case, so it's really only there to discourage "shoppers" and people who have no intention of hiring a lawyer at all.
I've gone back and forth with consultation fees. My practice now is that if the client comes from a good referral source, I waive the fee. If the client "found me on the internet," or otherwise "found me" somewhere, I advise of the consultation fee policy. I do not understand why lawyers act as car salesmen - thinking that getting the customer in the door, and in the car, will get them to buy. Car salesmen are great at what they do. They never discuss price until they've confirmed the customer loves the car, and the answer to price is "what would you like your monthly payment to be?" It's a game, and it's not for lawyers.
I find that a consultation fee sets the tone with the potential client that your time is valuable and your advice, worthwhile. A consultation without a fee is not a consultation, it's an audition.
Many lawyers scoff at the notion of a consultation fee because "no one in my area charges one." That's a great way to distinguish yourself as a lawyer - do what everyone else does.
I also think it's time we stopped talking fees at the end of the consultation. Lawyers who consult with potential clients regularly know that every meeting with a potential client has unspoken concerns: "can I afford this lawyer?" "Can the client afford me?"
It is a waste of time for both the lawyer and potential client to spend 30 minutes or an hour or more discussing a case when the client has $500 to his name and the lawyer wouldn't consider representation for less than $5,000.00.
Still, lawyers shudder to think about telling a potential client over the phone that "I don't take cases for less than _____________." Lawyers are fans of the car salesman model. "If the client meets me, he'll hire me."
It's time for lawyers to re-evaluate the free consultation and "hiding the ball" on the fee till the end. We are simply wasting time, our time, and the potential client's time.
Located in Miami, Florida, Brian Tannebaum practices Bar Admission and Discipline and Criminal Defense. He is the author of I Got A Bar Complaint.