Working Through Legal Fee Disputes

If you’re a lawyer, it has happened to you. A client wants you to complete a project. You provide a quote or estimate and immediately hear, "Whoa, that’s pretty high!" So what's the best way for attorneys to deal with clients who want to slash fees without ruining whatever relationship the attorney has been able to create?

Focus on the Relationship

John Thompson knew he found someone he could trust. In the early 1980s, the former head basketball coach of Georgetown University was introduced to a young attorney at the local Washington, D.C. law firm of Dell, Craighill, Fentress & Benton. They immediately formed a bond.

In a May 2015 interview with John Lombardo of the Upstart Business Journal, Thompson explained his relationship with David Falk, a George Washington University law school graduate and future sports agent who would represent Michael Jordan and a host of other well-known professional athletes.

“He is more than my attorney,” Thompson said of Falk. “We became very good friends. People talked about how he had a hold on Georgetown, but he could have easily screwed it up. If one of [the Georgetown players] got messed over, they’d tell the others. That was the danger. The biggest testament is his honesty. I was always impressed by how enthusiastic he was. It is a labor of love for him.”

For Falk, relationships were the foundation of his professional success. This theme has been proven true again and again - the most successful attorneys have the most successful relationships. The first step in creating a trusted advisor relationship without compromising your fees is to build trust and rapport with your clients.

Set expectations before beginning a project

The next step is to maintain your trusted relationships by handling fee objections using a systematic framework that keeps emotions (and potentially hard feelings) out of the discussion. Here's one way to approach this situation:

• First, establish the parameters of the project. Are you helping your client sell their house? Sue their employer? Prepare a will? Sit down and write what type of work your client is expecting you to perform.
• Second, actually ask your client what they expect to pay for completing this work. Make them say a number out loud. If the client's fee expectations are drastically lower than what your quote will be, use the opportunity to educate your client on why the fee will be significantly higher. List every step you (or an assistant) needs to complete in order to finish the project.
• Finally, provide your quoted fee. If the client wants to challenge the fee, go through the first two steps - verify the work the client wants completed and walk through the steps needed to complete the project. If the client is still unhappy, you can then very calmly refer them to another attorney for this project, while maintaining your trusted relationship status to use for future projects.

Fee disputes don't need to be confrontational. Establishing trust and confidence with clients allows attorneys to use a simple framework that sets expectations at the beginning of a project. By doing so, they can work through any fee disagreements without putting the client relationship at risk.