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Solo In Chicago

...empowering the Second City's entrepreneurial legal community

Saturday, April 08, 2006

Another problem with hourly billing...

I'm posting a blurb from the What about clients blog? below (first time I visited) regarding a problem with hourly billing:

B. Hourly billing creates an inherent conflict of interest between attorney and client. The client wants outstanding legal services at the lowest price possible, i.e., in the least amount of time. However, a lawyer billing by the hour has no incentive to be efficient, and in fact has the incentive to be inefficient, i.e., take up as much time as possible. I think that might be one of the reasons for the “scorched earth” letters that often come from counsel, looking at every possible nuance of a given question.

I agree with the gist of the above. I want to be more innovative in my billing. The one rather simple change we recently made was to often put a cap on our fees up front, particularly on rather basic matters that we do a lot and have a good feel for the time they might take. At this point matters like modifying child support or child visitation, we've tried to cap fees at $1500 to $2000. I think clients like it and if our hourly billing is lower we give them whatever it came to.


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