Lawyers always warn their clients to get it in writing whenever they buy anything. But that advice rarely includes buying legal services. After all, why muck up a new lawyer-client relationship by negotiating such touchy topics as hourly rates, promised results, cost estimates and billing practices?
But since the first of this year, state law compels lawyers to put it in writing when they sell their legal services.
The law requires that lawyers have a written fee agreement with their clients whenever clients are expected to spend more than $1,000. In 1983, California's lawyers were first required to have written agreements but only for contingency-fee arrangements--where the lawyer is only paid a percentage of the recovery. The new law applies to just about every legal service for individuals. (Corporate clients are excluded.)
Whether your lawyer is drafting a will or negotiating a lease, a written agreement is a must--unless there is an emergency, an implied agreement based on previous services or you waive in writing your right to an agreement.
The contracts must include the lawyer's hourly rate and other standard fees and charges (such as charges for photocopies and messengers), the nature of the services and the responsibilities of lawyer and client.
Equally important, the law requires that all lawyer bills describe the "amount, rate and basis for calculation of the lawyer's fees." But the invoice should be more than a calculation of the amount due. Although the State Bar advises its members that "nothing in the statute requires lawyers' bills to describe the services that were rendered," you should demand bills include a detailed description of services performed and by whom.
The State Bar has developed five sample fee agreements and published them in the September issue of California Lawyer, its monthly magazine. They are also available for $3.50 by writing, State Bar, Fee Agreement, P.O. Box 24527, San Francisco, Calif. 94124.
But before you ask your lawyer to sign one of the sample forms, remember that these forms were also written by lawyers. The forms, for example, do not include a provision requiring the lawyer to send the client copies of all court filings, correspondence, research memos and other legal documents. You should demand the provision; it's the best way to keep abreast of the status of your case.
And the forms can seem one-sided at times. One of them says the lawyer "shall take reasonable steps to keep Client informed of progress and to respond to Client's inquiries." Sounds well and good.
But then see what it requires the client to do: "Client shall be truthful with Attorney, cooperate with Attorney, keep Attorney informed of developments, abide by this Contract, pay Attorney's bills on time and keep Attorney advised of Client's . . . whereabouts."
Now, if you simply reverse those obligations and require the lawyer to be truthful and keep the client informed of what's going on, you might have a pretty good contract. So don't be afraid to negotiate a bit, even with your own lawyer.
There aren't many places to go to help figure out how to negotiate and review a legal-services contract. Obviously, your own lawyer will be of no use, and I wouldn't advise hiring another one.
Raymond M. Klein's book, "Putting a Lid on Legal Fees," published by Interlink Press in Los Angeles, contains a chapter on fee agreements and several samples from the client's perspective. Wesley Smith's "The Lawyer Book," published by Price/Stern/Sloan, is another source.