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In the invoice for Legal

hello and welcome back today I want to address a topic that I get asked a lot whether it's through direct messages or whether it's just people I run into which is how do attorneys really charge how do they bill this is going to be an important topic to understand because it's going to be part of your negotiations if God forbid you ever actually have to commit that Unholy of all acts hiring an attorney let's check it out [Music] attorney Bill Lane a controversial and sensitive topic why does it have to be that way let's get into this so if you've ever had to do that thing if you ever had to hire an attorney before first off I am so sorry but secondly you probably hired that attorney on an hourly fee retainer that's gonna be the first type of fee we talk about and hourly fee retainer is pretty basic pretty straightforward you negotiate some sort of hourly rate with the attorney whether that's 150 250 350 400 500 600 700 800 per hour whatever it might be you will also have to be responsible for paying typically for their expenses so things like perhaps xeroxing maybe there's a staff fee for paralegals things like that hopefully that's at a reduced hourly rate however then you'll have to put up some money in a retainer this will typically go to What's called a trust account which is a special account that attorneys have that's separate from their business account where they hold money that isn't theirs they are holding it in trust for some purpose so until that money actually gets billed properly and comes out of that account through proper invoicing procedures that money is actually yours or at a minimum it's easy to say it is not theirs that's why it's an attorney trust account not a business account or a savings account where it's just different we're not going to get into that today so they will keep track of their time they will keep track of their expenses whatever else is within the scope of that fee agreement and then they'll typically send you bills usually on a monthly basis where they will show you often in point one of an hour so six minute increments of look this is what we did this is what I researched this is what I wrote about this is that conversation that we had and this can be very frustrating because you may only have a quick question for an attorney the phone call may take 10 minutes because let's face it it's really difficult to have a conversation that doesn't last at least 10 minutes with an attorney so then when you get your bill at the end of the month let's say that was your only thing that happened on your case only thing that's on the invoice very commonly people get frustrated because they see instead of maybe a 0.2 they'll see a 0.3 or 0.4 indicating that the attorney is represented that they wound up spending 18 to 24 minutes on the case so what's going on here well the answer is that attorneys have certain documentation duties that they have on them or at least that's what probably has happened here so in other words okay they had the phone call you talked about something about your case you asked some important questions maybe you made a decision about what to do or what you don't want to do okay so the attorney will typically then take a few moments after the phone call maybe you got an email or a letter about it or maybe they just wrote a little memo to self if you made a very important decision I always instruct my attorneys at my firm we've got over 20 Attorneys at my office to always always always send a confirmation letter or email to the client to make sure that everybody's on the same page the attorney is hearing what you're saying and it's a great opportunity to provoke further questions about whatever the case may be but we also don't do hourly billing but that's it you pay a certain amount you agree to a certain rate certain expenses are going to be covered in that and then you drive along and then much much like your car when it runs out of gas or when it starts to get to a certain point it may be the client's responsibility to then bump it back up so maybe you put five thousand dollars down you're paying 300 an hour once the account drops to a thousand the attorney gives you a hey we need to bring this back up to five thousand or maybe even higher or maybe less depending upon what you think might be appropriate and what's left in your particular case so that's basically your hourly fee agreement at the balance of the case any money that's still in the attorney trust account that is on used the attorney has an obligation to refund to the client I can feel the jokes lighting up in the chat right now just as a reminder we do not do at my firm hourly fee agreements or at least we try not to do them let's check out the second type of attorney retainer foreign so the second most well-known type of an attorney agreement is the contingency fee agreement this is what you hear about on TV and commercials and so forth of no fee unless we win you'll typically see this in personal injury attorneys car accident attorneys that kind of stuff for the simple fact of the matter that they are suing an insurance company that they know will pay and they will only take cases that they know they will win and make enough money on if you ever talk to a personal injury attorney and they don't want to take your case contingency they will only take out an hourly fee agreement they may not have the most amount of confidence in your case but hey I'm not a personal injury attorney maybe your mileage will vary depending upon where you are but that's what it is in a nutshell you only pay a certain amount maybe a percentage of a settlement or something like that or whatever it might be you only pay a certain amount if you achieve a certain outcome or certain milestone in the case whatever you might have now it's important to remember that in certain States like my state it may be illegally or ethically impossible to represent clients on a contingency fee agreement in all types of matters so for instance contingency fee agreements in criminal cases cannot do it cannot do it and you'll have to ask your state bars to exactly why my suspicion is that the gist to it is that state bars want attorneys focused on the means they want to make sure that clients are afforded as zealous and strong advocacy and strong defense they don't want attorneys cutting corners being tempted to lie or whatnot in order to stretch out to achieve a particular Milestone a particular outcome that's my speculation if you're interested in me doing a little bit of a deeper drive to figure out why certain types of attorneys in certain types of cases are barred from contingency fee agreements like self-defense criminal cases family law cases whatever the case may be let me know in the comments but that's pretty much the wrap to contingency fee cases [Music] thank you the third most popular type of fee agreement is the flat fee agreement and this is something that my firm uses almost exclusively why it's simple it's easy a client calls us we describe our scope of services what we're going to include and what we're not going to include for a particular flat fee if there's a payment plan we figure that out and that's it it's very simple it's very painless and that allows us to focus on a couple different things the best outcome client communication and making sure that of course we're doing all the different things we have to do along the way but we're not worried about sending out monthly bills attorneys have no hourly billing or or quotes that they have to meet on the year or anything like that attorneys have one responsibility and that's to take care of their clients that makes my job as a manager of about 20 attorneys much easier that makes your job as a client much more simple as well because you don't have to worry about reviewing bills fighting bills wondering who's patting what all those dark arts are something that we just basically take a pass on not interested in not for us we'll leave that to the other guy but that's a flat fee agreement what are common exclusions that you might see well typically trials experts motions and appeals trials experts motions and appeals are separate unlike what you've seen in TV and Hollywood law where every single case goes to trial in real life most cases in the criminal justice system again may vary with your particular listings to where you are but it's generally between about two to four percent two to four percent of cases will end in some sort of trial maybe about a third of cases give or take probably less as a system more for our firm but less is a system of cases will have what's called motions motions are legal defenses not a factual defense which is a trial check out our video Linked In the description below if you want to know more about a trial versus emotion but trials experts motions and appeals are all going to be separate okay statistically they're not likely to happen and frankly we don't really know how to come up for something whether cases can be a one day trial or two-week trial whether emotion is going to be five to ten hours of our time or 30 to 40 hours over time depending on what's going on so it just makes more sense to not charge clients for something that likely isn't going to happen as well as not to just arbitrarily pick numbers of what they might come up with should it occur but of course you might be saying but Tom aren't you doing that anyways when you're quoting somebody at the front of their case what a flat fee is yes or no when you've done thousands upon thousands upon thousands of cases for 10 plus years and you're listening to someone talk on the phone about what happened you got their case type you know the county they're in you know the prosecutors they have you have a pretty good handle as to what's going on there I can be right every time no of course not but are you going to get it right the vast majority of the time yeah at least you should otherwise you're not going to be in business very long so that's really the third type of fee agreement that we see out there there are some unusual ethical issues when it comes to if a client wants you to withdraw perhaps they hire a new attorney maybe they hire us as the successor Council whatever the case may be you want to know more details about that let me know in the comment section below but for now let's just leave it there so guys those are the three most popular types of fee agreements that I see that's out there there can be other Hybrid models such as an advance fee on a on an hourly all sorts of different stuff but as a general rule those are your basic nuts and bolts for what you need to know for how attorneys get paid which will hopefully Empower you to know a little bit more about what my options might be to be on the lookout for some traps in my opinion that I see out there so you need to be careful for if you like this video please of course do all the YouTube 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