Collecting fees begins at the beginning, according to recent CLE webcast

Collecting your fees—getting paid—is the third part of the work cycle, after obtaining clients and doing the actual work, said Ed Poll during a recent CLE webcast, noting that collection efforts really begin when lawyers first meet clients.

"If you have to wait until after you do the work to learn that you're not getting paid, it's too late," said Poll.

Poll, a principal in LawBiz Management in Venice, Calif., joined J.R. Phelps of the Florida Bar in presenting the webcast, "Collecting Your Fees: Ethically Getting Paid from Intake to Invoice." Michael Downey, of Fox Galvin LLC, St. Louis, Mo., moderated the session.

In response to Downey's question of what can a lawyer do to ensure he or she will receive payment, Poll said that a lawyer should clearly outline his or her billing practice in the letter of engagement. He emphasized that having the client initial the paragraphs relating to costs concretely affirms that the client has seen and understands those policies. Poll further suggested that when lawyers prepare a budget for a client that outlines the work to be done, they have the client initial that as well.

Phelps explained use of an intake form that was created as a result of frustration over lawyers having ethics troubles with clients because of questions and disputes relative to billing. In order to help outline any potential conflicts of interest, the form contains questions about other players in the dispute. Further, it asks potential clients for their responses regarding their ideal outcomes and what they can accept. The form asks whether the prospective client has met previously with other lawyers about the current problem. These questions help the lawyer get a sense of the reasonableness of the client. The questionnaire concludes by asking how the individual will pay for services if the lawyer takes the case.

The form does not go into the substance of the case and can be filled out in the front waiting area of the law office, similar to the form one might fill out in a doctor's office.

Phelps said that if a client agrees to pay the lawyer the day of the consultation, it indicates a commitment by the individual to the case.

Poll suggested that lawyers stress to their clients the "two-way street" nature of the lawyer-client relationship. The lawyer has the responsibility of representing the client to the best of his or her ability; the client has the responsibility to tell the lawyer the truth and to pay for services.

All of this discussion is pre-billing. The two-way street and relationship analogy could also be used with respect to the actual billing. It's in the best interest of the client, said Phelps, to bill in a timely fashion. Doing so gives the client an opportunity to end the case if the cost is reaching the point where continuing is no longer worth it.

A lawyer is more likely to get paid on time, said both Phelps and Poll, if he or she clearly outlines what work is being done during that billing cycle, and the value of that work to the case. For example, they pointed out the importance of communicating exactly what was done and why. The said lawyers should go beyond simply stating that legal research was conducted to explain what was being researched and why it was relevant.

Given the emphasis of the webcast on the work that is done even prior to a bill being sent, Downey asked if ensuring that you as a lawyer get paid depends to a great extent about the work that is done at the front-end. Poll and Phelps both agreed that was so.