Small Law Firms, Solo Practitioners

Back In The Race: What A Potential Client's $400 Consultation Fee Really Pays For

Clients may believe that consultation fees are lining lawyers' pockets, but that couldn't be farther from the truth.

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resume girlA potential client — we’ll call him Mr. Client — contacted me wanting to talk about his legal problems and his options. I charged $400 for a one-hour consult to be paid in advance. We met at my office, where I offered him a double-shot cappuccino with one of those cute, artistic foam designs.

Over the course of a little over an hour, I heard Mr. Client’s story, reviewed his paperwork, and listened to him rant about his backstabbing co-workers, his insane boss, and certain ethnic minorities. Afterwards, I told him there was nothing I could do to help him and gave him a detailed explanation why.

As he left my office, he said, “Thank you for the most expensive cappuccino I have ever had.”

I don’t know if that was a joke or if he was implying that my artistic cappuccino was worth more than my legal advice. But I can tell he was not happy and he probably felt like he threw away $400 so I can pay for the Maserati he saw in the parking lot.

If that’s the case, then the joke’s on him because the Maserati isn’t mine. It belongs to the septic tank contractor three doors next to my office.

I understand that $400 is a lot of money. But is all of that going straight into my pocket? Let’s look at what Mr. Client paid for with his $400.

First, some of that money has to pay for the fixed costs that self-employed attorneys have to pay. This includes office rent, phone bills, bar dues, professional association dues, CLE seminars, legal research subscriptions, malpractice insurance, advertising, and office supplies. And this is the bare minimum in order to have even a chance of maintaining a steady business. I didn’t include employees (which also translates into bigger rent bills) or gas and parking expenses to go to court, opposing counsel’s office, and other necessary places. And lawyers working on contingency have to pay all of the litigation costs out of their own pocket with risk of loss. Now I wholeheartedly concede that wasteful and excessive spending exists in law practice, but I’m not here to cover Biglaw.

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Second, Mr. Client paid for experience. When I say experience, I am not just talking about what I learned in law school, reading case law, or from CLE seminars. I am talking about expertise gained from making mistakes, advice from mentors, opposing counsel, industry insiders, and helping good clients (and dealing with bad clients).

Despite all the talk about lawyer oversupply, it is still hard to find a good, trustworthy attorney. You don’t believe me? Look for one the next time you’re sued or if you want to sue someone. See how long that takes. Or are you going to hire the person that pops up on the first page of an internet search just because he’s been blessed by the Google gods? I hope not.

Some argue that experienced attorneys should not have to charge more on an hourly basis because they do not have to do as much extensive legal research as a new attorney. That might be true. But more experienced attorneys generally charge a significantly higher fee which can offset the reduced research time. In addition, experienced lawyers also have to do their own investigation of facts and sometimes even write their own legal documents.

Finally, Mr. Client is paying for a lawyer’s return on investment. In most cases, it still takes a minimum of seven years to train attorneys and make them eligible to sit for the bar examination. Because of the lousy job market for young attorneys, some also have LL.M.s, MBAs, CPAs, Ph.D.s, or other advanced degrees in order to stand out among the crowd. In most cases, this means they have to repay massive student loan bills probably for the rest of their lives. The public is not sympathetic because they think that lawyers should have received scholarships to law school if they are so smart. Also, they think that lawyers will pay it off easily because they will eventually get a million-dollar jury verdict.

I can get into the bigger economic picture on the legal job market and decreasing compensation trends. But people like Mr. Client don’t want to hear it because they don’t care. It’s not their problem. Mainstream media is infested with lawyer advertising promising free consultation. Politicians and even some prominent lawyers are calling for lawyers to increase pro bono work to give back or help promote access to justice for the greater good. Because of this, people like Mr. Client have this mentality that lawyers should provide their services for free for less than the cost of a tablet computer. Mr. Client thinks he should be treated no differently than the broke, homeless guy.

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So Mr. Client, the bottom line is you paid for a legal opinion, and that’s what you got. It wasn’t the opinion you wanted to hear and you probably could have got it if you pieced together the advice from the 20 websites you found online. But you heard it from a professional who knows what she is talking about and you’re going to act on it unless you decide to get a second opinion.

Your $400 covered a small portion of my monthly overhead and student loan bill. If I’m lucky, I’ll have enough left over to buy groceries. Consider yourself lucky you didn’t go to a less ethical attorney who would have charged you $4,000 for a bunch of smoke and mirrors.

One more thing, the cappuccino was free.

Shannon Achimalbe was a former solo practitioner for five years before deciding to sell out and get back on the corporate ladder. Shannon can be reached by email at sachimalbe@excite.com and via Twitter: @ShanonAchimalbe.

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