|Q: Your firm charges hourly rates as opposed to flat fees. Why do you do this, and why should I hire you for an hourly rate when the firm down the road may charge me one set, certain flat fee?
A: There are many reasons we do not bill a flat fee-based charge for legal services. Some of the basic concerns the firm has with such charges are:
Our fee system removes uncertainty and ensures even, consistent and dedicated measurement of services.
Your case is important to you. Immigration cases hold the key to a client’s entire future. A job, a family relationship and education – all these things can depend on success in your case. A flat fee results from an attempt to estimate internally how much time will be spent on a case. This is based on the hope the case does not turn out to require the commitment of more time and resources than the firm planned. Lawyers must avoid conflicts between their own interests and that of the client. When a case turns out to involve more time than was estimated then the lawyer may find himself or herself devoting considerably more time to the case than was anticipated. This creates an internal conflict between the lawyer’s financial interest in generating the needed cash flow to run the firm and compensate employees and the interest of the client in having a devoted advocate who will not be presented any motivation to avoid zealous representation of their case. Thus, DJ Chapman Law has proactively decided to remove a possible trigger to even the appearance of a conflict between the lawyer’s interest and that of the client. Under the ethical rules of each state in which the firm practices, the firm cannot allow a client’s interest to conflict with that of their lawyer. It is true that this has no doubt cost us cases, but we would rather represent all our clients free from the stress that goes with underestimating costs than being presented with the risk, however remote, that one of our lawyers might represent clients at less than the very best level of service just because the firm had to take cases just to generate lost income. The more cases you take the less time you have to devote to the cases you have. We believe the best way to ensure optimal case allotment per lawyer is to use the hourly fee basis. The client then knows what the real unit of charge is and the lawyer knows they can operate without stress in getting the best result for the client. This was a policy choice made by our firm with client service and ethics in mind.
Our fee system removes the “stock” filing or “cookie-cutter” approach that could arise.
Flat fees are also avoided because no two cases are exactly the same. Forms and exhibits may be similar, but cases can take unique twists and turns based on the facts as they develop. Many of the firm’s corporate clients will find the “one of a kind” employee that will result in a revenue boom for their company. They want us committed to the finer points of the case and not simply filling a form. In immigration, the strategy is of great importance, and it is impossible to guess how much thought is enough in a case at the beginning. You want a case that comes together and runs like a fine Swiss watch and not a case that is generically thrown together based on bare minimum documentation requirements. In our practice, the forms themselves are the most minor portion of the filings and case strategy. You want us to learn about your company, learn about the job the employee will be doing, and learn about the products or services of your company. After all, you are hiring a lawyer as a resource for success. You do not want the lawyer to simply apply a cookie-cutter approach to your case because each immigration case truly is different. Each case strategy and document packet compilation is finely crafted by skilled professionals to meet each client’s specific needs. We are fiercely loyal to our clients and completely committed to their case. Your case is our case and must be as important to us as it is to you. Generic filings that are easily valued for fee purposes are not what we are about.
Our fee system prevents overwork of your lawyer.
Whether it is a person in a law firm or a machine in a factory, the overwork of either of them can cause them to burnout. Immigration law is highly complex and the complex planning and thought process can cause overload. You want us to be focused on your case and not overworked. Unfortunately, a possible consequence of the flat-fee system is overwork. If we underestimate the time it takes to effectively complete one case at the beginning and charge a flat fee that does not cover the work done, our firm would not survive long without taking in other cases to make up lost revenue. Taking on more cases to cover lost revenue and effectively fund a firm will result in exhaustion and exhaustion results in poor representation of all clients. Would you as a client want a lawyer at our firm to work long and exhausting hours on many cases, or would you want our lawyers to work fewer cases within a normal office day so as to be rested and focused when addressing your case? The answer is obvious and that is that you want the lawyer to balance their day and devote time to your case in such a manner that they pay attention to detail and are focused.
In addition to the exhaustion factor is the issue related to the number of hours in the day. Our lawyers are expected by the firm and required by ethical rules to be attentive to clients and their cases. If a lawyer is overwhelmed with work then something has to give. There are only so many hours in a day, and our lawyers will not cut corners on client cases. It is our internal policy not to prospectively risk the dedication of necessary time to the client’s case.
Our fee structure meets our ethical responsibility to charge a reasonable fee.
Attorneys are required by ethical rules to charge no more than a reasonable fee. As was discussed above, cash flow is one concern that motivates DJ Chapman Law to avoid flat fees. However, there is another concern that focuses on the client. Thus, if the client enters into an agreement to pay us $5,000 for a flat fee case based on the attorney’s assumptions of how much work is involved and the attorney is wrong and the case really takes very little work then how does the attorney determine how much to take as a fee? Does the client enter into secondary negotiations regarding refund of fees at that point? How does the client determine what the case was really worth? These are difficult questions to answer and can lead to tremendous uncertainty for the client and the firm. At least billing hourly applies a measure of value to units of time. Billing can then be split into fractions of hours and the client does not end up paying too much for services. Our fee agreements inform the client about the hourly rate and also the increments of time to be billed.
There is also an added concern for the firm from an ethical standpoint and also from the client. Lawyers should only receive fees when earned and so the question for us in a flat fee case is when do we earn the fee? Do we earn the entire fee upon taking the case and deposit the entire fee into our business account when received? Such a practice raises tremendous danger the money will be devoted to firm operations and would not be there in the event that the client is entitled to a refund of some of the fee, and if the client is entitled to a refund then the refunded portion of the fee has belonged to the client all along. As ethical rules prohibit the comingling of client funds with the firm’s general business funds, there is a serious question as to whether the firm has violated ethical rules regarding the handling of client funds. Such violations are very serious. Law firms must ethically handle client funds and property and DJ Chapman Law has concluded that flat fees simply do not accord with our ethical duties.
Thus, as you can see, there are many issues involved in a lawyer’s fee structure. Although our explanations are many they match our concerns. The above reasons are merely some of the internal reasons the firm has chosen the billing structure in place. After many years of work DJ Chapman Law has determined that the hourly rate serves the client’s interest and the firm’s ethical responsibilities best.