How To Discuss Fee Bill Issues With Your Lawyer – Part III

[This is the third post in a series on how to discuss fee bill disputes with your lawyer. If you have not done so already, it is a good idea to read the first two posts in this series as they detail steps that should be taken before getting to the point where the additional steps outlined in the post should be considered.]

In my last post in this series, I ended with the assumption that communications with your lawyer and/or the firm’s managing partner or other partners in the firm failed to resolve the billing issues.  In this post I will discuss what additional steps may be taken to resolve the billing issues once direct communication has not worked or has broken down.

Mediation or Arbitration 

One step you may may want to consider is mediation or arbitration of the dispute.  The ABA Model Rules of Prof. Conduct encourage lawyers to resolve client disputes with through mediation or arbitration and many state and local bar associations have fee dispute mediation or arbitration programs.  Some mediation or arbitration programs may be free or the they may charge only a nominal fee. It is also important to note that in some states, mediation or arbitration is mandatory for the lawyer if the lawyer’s client requests it.

If your county or city bar association does not have a fee bill dispute program, there may be such a program available through the state bar association.  You can contact your state’s bar association for information.* Notwithstanding whether a bar association has a fee bill dispute mediation or arbitration program, many bar associations may still provide publications to the public on how to work with an attorney to resolve a fee billing dispute.

  • Mediating a Fee Bill Dispute

Mediation programs are often favored in dispute resolution because they generally are informal and non-binding. One important thing to keep in mind is that a mediator does not make a final decision as an arbitrator or judge would do in a case. Rather, a mediator just helps you and the lawyer come to a mutually agreeable solution.

As mediations do tend to be informal, the rules of evidence and other legal procedures that apply in a court of law are usually not applicable in a mediation. However, this does not mean that mediation programs will not have some rules or procedures that must be followed. But the rules or procedures usually will be less formal than found in arbitrations or court proceedings. And because of the overall informal nature of mediations, they can be less stressful than arbitrations.

You can hire a lawyer to represent you in a mediation. But because of the informality of a mediation, you usually can represent yourself in a mediation.  And perhaps best of all, if you do not like the outcome of the mediation, you are not obligated to sign any agreement and thus you are not bound by the results of the mediation.

  • Arbitrating a Fee Bill Dispute

While mediations then to be more informal, arbitrations are more formal and can be more like a trial. In an arbitration, the arbitrator or arbitration panel will act like a judge in a civil trial. And while some arbitrations can be non-binding, most of the time they are binding.

Many fee or retainer agreements contain a clause providing that a dispute or claim against the lawyer including a fee bill dispute or a malpractice claim must be submitted to binding arbitration. For such a clause to be valid, however, the lawyer should separately explain the effects and ramifications of arbitration to the client so that the client can make an “informed decision.” See ABA Formal Op. 02-245 (2002) Retainer Agreement Requiring the Arbitration of Fee Disputes and Malpractice Claims at p. 7.

Also note that a binding arbitration clause in a fee agreement may not necessarily trump a client’s right to seek non-binding arbitration or mediation. See, e.g., Calif. State Bar Arbitration Advisory 2012-02 (Mar. 16, 2012) Arbitration Agreements at p. 1 (“[B]inding arbitrations agreements do not extinguish a client’s right to non-binding MFA under Business & Professions Code § 6200.” citing Benjamin, Weill & Mazer v. Kors (2011) 195 CA4th 40, 53.).

As noted, while some arbitrations can be non-binding, most arbitrations are binding. This means that once you arbitrate the dispute, you are bound by the outcome.  And while arbitrations may not have all of the same rules that a regular court would have, certain rules of evidence may still apply.  Because of this and if the arbitration is to be binding, you definitely should consider having an experienced attorney represent you at an arbitration.

Filing a Suit

In more serious instances of overcharge – especially where you may have paid the lawyer a substantial amount of money and where the lawyer or his partners have refused to discuss the matter with you or agree to mediate or arbitrate the dispute – you may have no choice but to file a suit.

To determine whether or not you have adequate grounds to file a suit, I would refer you to a local attorney who specializes in attorney malpractice or professional responsibility. Many city and county bar associations have referral services that can direct you to a  attorney who is qualified in these areas of practice.

One thing to emphasize is that even though a court may find that your lawyer overcharged you and you are entitled to a refund, this may not mean that you will get all your money back. You will likely still owe the lawyer a “reasonable” fee for her services.  On the other hand, some  courts  have  held  that  lawyers  who  have committed  serious  breaches  of  their  fiduciary  or  ethical  duties  owed  to  clients have forfeited their right to any compensation and cannot recover even on the basis of quantum merit. See, e.g., Lance Holding Co. v. Ashe, 533 So. 2d 929 (Fla. Dis. Ct. App. 1988)(“An attorney displaying conduct sufficient to void an agreement in law should  not  be  allowed  to  profit  from  his  blatantly  unprofessional  conduct  in equity.”). Again, a local lawyer who specializes in attorney malpractice or professional responsibility can advise you on this point.

The Nuclear Option: Filing a Disciplinary Complaint

Another option to consider in resolving a billing dispute with a lawyer is filing a disciplinary complaint. This would be an option if the lawyer has violated one or more of the ethical rules that apply to lawyers when billing for fees and costs. But while I label this as an “option,” it is really not so much an option as you might think it is especially if your main objective is to successfully resolve the billing dispute with your lawyer. I will go over what I mean by this statement as well as cover all the other issues involved in filing a disciplinary complaint against a lawyer over a billing dispute in my fourth and final post in this series.

_____________________________________________________________

* There is no link that I can provide you with to find out contact information on state bar mediation/arbitration programs. However, I do have a PDF document put out by the ABA that provides this information. If you would like a copy, please contact clientservices@legalbillaudit.com and request a copy of “Directory of Fee Arbitration Committees.”

 

Leave a Reply

Fill in your details below or click an icon to log in:

WordPress.com Logo

You are commenting using your WordPress.com account. Log Out /  Change )

Google photo

You are commenting using your Google account. Log Out /  Change )

Twitter picture

You are commenting using your Twitter account. Log Out /  Change )

Facebook photo

You are commenting using your Facebook account. Log Out /  Change )

Connecting to %s