02 Mar More on Flat Fees for Legal Matters – Drag it Out? Nope.

The vast majority of attorneys are honorable, hard working, well-intentioned and client-focused. Some, of course, are much more interested in their own bottom line than that of their client. Either way, even when well-intentioned, often clients perceive that their attorney is looking to milk their case for more money when they are billed by the traditional hour.

When billing by the hour, the moral incentive of course is to work efficiently and complete the matter quickly and effectively. But billing by the hour creates a competing financial incentive – to drag things out just enough so that if it goes any further you’d be upset. But even then things could have been brought to a head quicker in many cases.

With flat fees, which I strongly prefer in most corporate and securities transactions, the moral and financial incentives are aligned. The less time the lawyer spends, the more successful the arrangement. So finding ways to be efficient, streamline the process and simplify the transaction are all good and help both client and the attorney. Dragging it out with a flat fee hurts everyone. Of course the lawyer must take care in the process to ensure that his or her professional obligation to fully protect the client is met as well.

Watch here for more about these alternative billing arrangements and the hope that our profession begins to work harder to embrace them!