In today’s economy, business must think creatively about managing their legal costs. The following will briefly summarize different ways legal costs are charged.

Hourly Rates

In most cases, attorneys charge for their services based on their hourly rate. Obviously, one great way to lower your attorneys fees is to minimize the amount of this hourly rate. As one might expect, this rate is often tied to the experience, expertise and reputation of the attorney and so a client chooses a cheap attorney at their peril. In general, your attorney’s hourly rate is negotiable and as such should not be taken at face value.

Other Fee Arrangements

Fee arrangements other than hourly rates are becoming increasingly common in the law. The most common is the so-called contingency fee, whereby your attorney only takes a percentage of the winnings of the case (usually 25% – 40%), and takes nothing should you lose the case. Lawyers usually work on contingency for plaintiffs that have a high likelihood of success. The lawyer then takes a percentage of the settlement or verdict. Usually the percentage varies on the amount of risk involved in the case (i.e. a case with less likelihood of success would more likely incur 40% contingency fee, while a higher likelihood of success would be lower).

Some attorneys will charge a flat rate for their services in routine matters, such as divorce cases, business filings and other legal matters that require a predictable amount of work. These flat rate arrangements are less risky since the client knows the maximum that will be paid, however, they are not always a great deal. Make sure to ask your attorney how much time she plans on spending on your matter to make sure you are getting a good deal. Attorneys owe their clients a fiduciary duty to fully inform and treat you fairly and therefore should be willing to tell you their best good faith estimate of the time it will take to provide the needed service.

In some cases, attorneys will consider other value-based fee arrangements. Of course, the type of payment – like anything else – is always up for negotiation For a good break down of these arrangements, follow this link: http://www.abanet.org/careercounsel/billable/toolkit/altfeeslmahandouts.pdf

If you cannot afford an attorney at all….

If you are an individual and don’t think that you can afford an attorney at all, you may appear pro se, that is, for yourself. You are not required to have an attorney when you are sued (unless you are a corporation, which cannot represent itself). If you are an individual with limited funds in this respect, you have the option of having an attorney act as your pro se coach.

A pro se coach reviews documents and letters that you prepare and sign. The attorney may also help you prepare for a hearing in which you represent yourself. Such an arrangement is especially useful in smaller matters, such as small claims court or if you want to enforce a lease or collect bills owed to you. To find attorneys in your area willing to appear pro se, ask around as advised above, or you can simply use www.craigslist.org which has many listing for such services.

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