LEGAL FEES

What is a legal fee?

A legal fee is the compensation to a lawyer for his services.

What is the basis for a legal fee?

The amount of time spent on a particular problem is probably the basic ingredient in any fee charged by a lawyer. Because a lawyer, unlike a doctor or a dentist, performs many professional services when his or her client is not present, the client is often unaware that the four-page document and the advice given in a few minutes are actually the product of many hours of work Also, the end product which the client sees is often the result of time spent by other persons in the lawyer's office, for example, a legal assistant, a law clerk or a secretary.

When you engage the services of an attorney, remember that you may be hiring an entire law office to work for you.

Since no two legal situations are exactly alike, the lawyer's fee will depend upon all the factors involved. After you have related the facts in your case, your lawyer will try to give you an estimate of the fee if you ask for one.

How is the fee computed?

In determining a reasonable fee for his or her services, a lawyer usually considers a number of elements, including the time spent, his or her experience, expertise and reputation, the responsibility involved, and the results obtained. This fee will normally be computed on an hourly rate and will depend upon such elements as:

1. Time: Time is the basic element in determining a fee. Although many lawyers work from 8-1 0 hours every day, less than 2/3 of that time can be billed to clients. A lawyecs remaining time is devoted to keeping up with new laws and old laws that are changing, taking courses or continuing legal education, attending bar association meetings, and volunteering in legal services programs.

2. Ability, Experience and Education: A lawye(s legal education is made up of good law school training together with later legal experience. Just as a doctor charges more for a complex operation than for a routine one, if an experienced lawyer is better trained to handle your particular problem and is well-known as an able lawyer in a special field, he or she may charge a higher fee because the specific services offered are in special demand. In addition, the difficulty of the problem, the importance of the problem to the client, and the extent to which handling the problem will create a conflict for the lawyer or prevent his or her taking another case all constitute considerations in determining the fee.

3. The Results Achieved. In some cases, the result itself may decide the fee. For example, in personal injury cases, a lawyer and his or her client often use a "contingency' agreement. Under this @ of arrangement, the lawyer will not receive any fee unless money is recovered for the client. If money is recovered, the law-

yer is then paid a percentage of the recovery, which has previously been agreed upon by the lawyer and the client. This percentage vall depend upon the amount eventually recovered, the @ of case involved, and the estimated time which vall be spent on it. Court costs, such as filing and subpoena fees, are usually the responsibility of the client, who must also reimburse the lawyer for any actual expenses paid out of office funds (such as long-distance telephone calls, invesbgators, medical reports and depositions).

When no contingency fee arrangement has been made, the lawyer vall expect to be paid whether the client vans or loses the case. Remember that no lawyer can guarantee the results of any court proceeding.

4. Operating Expense and Overhead: Nearly 50% of the gross annual income derived from legal fees vall be applied towards the cost of operating the average law office (including such items as rent, equipment, law libraries, supplies, professional and non-professional staff, and insurance).

What about discussing the fee?

As soon as possible after you have engaged a lawyer, you should discuss the cost of the legal services which he or she YAII provide. Agreement at the outset vall prevent later misunderstandings and vall promote good relations between you and your lawyer. There may be circumstances when the lawyer may not be able to determine the exact amount of time and effort he or she vall require to handle your case, but he or she should be able to fumish you an estimate based upon past experience. Sometimes your lawyer may quote a total charge for the work involved, or just give you an hourly figure for the estimated time required on the particular matter. You should consider reducing the understanding of you and your lawyer regarding the fee to wribng, particularly when the fee is based on a contingency agreement. You should never hesitate to discuss fees at any time during the lawyees handling of your legal matter. If you receive a statement and believe the fee is not proper, talk it over vath your lawyer. Usually, misunderstandings about fees result from the fact that the client is not aware of the extent of the lawyees work on the case. If you do not regularly see a lawyer, you may understandably believe that the activities of a lawyer are limited only to those which you do see. It is always a good idea to obtain copies of all documents and correspondence relating to your case.

When do you have to pay?

The time for payment of legal services depends on the @ of legal service which you have asked the lawyer to render for you. In many cases, your lawyer ma .y require a payment before agreeing to undertake the work- This pa@ ment, which is frequently referred to as the retainer, may be only to assure his or her availability, or it may be for credit against services to be performed or applied to costs which might be incurred. Discuss vath your lawyer which arrange-

ment is applicable to your case and reach a clear understanding with him or her. If you think you may be unable to pay promptly, talk it over vath your lawyer. You should be able to reach an agreement.

How can you hold down your legal fees?

To cut down on the amount of time the lawyer vall have to spend in gathering information and handling your legal matters, follow these simple guidelines.

1. Write down the names, addresses and telephone numbers of all persons involved as well as all the facts you can recall which pertain to the matter.

2. Bring any papers relating to your case to the first interview with your lawyer.

3. Be as brief as possible in all interviews vath the lawyer. Keep in mind, however, that you should give your lawyer the complete story. Facts which may not seem important to you may have serious legal

consequences.

4. Do not allow emotion to cover the facts given; be as accurate as you can.

5. Make full and honest disclosure of all the facts, good or bad. This is essential in malting a determination about your case, and your lawyer vall keep it in strictest confidence.

6. Avoid any unnecessary telephone calls to the lawyer.

7. Get legal advice before signing any documents or taking any legal action. Then follow the advice of your lawyer.

8. Consider the financial advantages or disadvantages of a proposed legal action by discussing it vath your lawyer first. (For example, would the court costs and legal fees be more than the amount of the bad debt you would like to recover?)

In Conclusion

Our suggestion that you consult a lawyer is for your own benefit. Litigation should be the last resort, and competent legal advice vall help you adequately explore other avenues. Preventing legal problems before they arise YAII save you worry, money, and Ume.

This pamphlet was prepared as a public service by the Rhode Island Bar Association Committee on Public Relations. It contains general information about legal fees in Rhode Island. If you have a legal problem and do not have an attorney or know of one, you may contact the Lawyer Referral Service of the Rhode Island Bar Association at 421-7799.