About Accession Law of Madison, Wisconsin

“Accession” [ak-sesh-uhn] noun– that which augments, expands, grows, increases, or improves.

Synonyms: accretion, addition, attainment, augmentation, enlargement, extension, improvement.

Tuesday, March 12, 2013

Juggling Is For Clowns and Lawyers – Drop the Billable Hour

What do a lawyer and a clown have in common?  No, this is not another lawyer joke.  The answer is “juggling.”

A lawyer almost always manages many files at the same time.  The practice of law is a juggling routine, where the attorney must keep many different matters “in the air” at the same time.  Some attorneys with volume practices juggle a high number of fairly uniform cases.  This is analogous to juggling 10 tennis balls.  Other attorneys process wildly distinct cases.  Juggle a ball, a bowling pin, and a chicken. 

What makes this a bit difficult is that the juggler must set down one object and pick up another (or two or three) and never drop any of them.  Further, the objects are usually covered in plain boxes and wrapping, but one of the objects may, at any time, turn out to be a chainsaw.

What does this have to do with the billable minute?  One doesn’t pay the juggler by the amount of time that a particular object is in his hand.  Likewise, the amount of time that a lawyer spends actually touching a file has little to do with the management of that file.  Often neither the client nor the attorney fully knows the contents of the problem that the client is asking the attorney to juggle. 

Managing a legal file involves knowing the characteristics of the matter and how it is likely to behave.  It involves anticipation of problems.  It involves keeping the file moving toward the eventual resolution. 

The amount of time spent keeping the file “in the air” has little to do with whether the file is managed effectively or efficiently.  To the contrary, an experienced attorney should be able to handle matters within his competency in a shorter amount of time.  What would be the sense in paying an attorney more because he has to spend more time on a matter than a more knowledgeable competitor?

The billable hour is the standard method for law firm charges because it is a proxy or estimate of the service rendered.  The billable hour method of billing assumes that the hourly rates of different attorneys are directly correlated to the value they offer.  It also assumes that attorney time is used as efficiently as possible.  I do not believe either of these assumptions to be correct.  I do not believe that the time spent on a matter is irrelevant to the fair charge, but the time spent is not the only relevant factor. 

My clients and I usually are able to arrive at a better estimate of the anticipated value of my services after taking into account the complexity of the matter and my experience.  For this reason, I prefer flat fee billing where possible.  If a flat fee is not possible, I would prefer to use a fee range which identifies the variables that might make the fee higher or lower.  My clients appreciate the greater certainty and I believe that such fees generally better approximate the value of my efforts.    I will leave the billable hours to the other clowns.

James N Graham is a real estate and business attorney with Accession.

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