Traditionally, lawyers have billed their clients an hourly rate for work performed. The usual model is that the client pays an advanced deposit, also known as a retainer, and the lawyer bills his time from that deposit. Each month, the client gets an invoice saying that the lawyer worked X amount of hours on the client’s case. X hours is then multiplied by the hourly rate that the client has agreed to pay, and that is the amount that the lawyer takes out of the client’s deposit that month. For example, if the client made a $1,000 deposit, if the lawyer billed $200 in one month, $800 would remain in the client’s deposit. When the deposit runs out, the client is then asked for another deposit, if the case is not yet concluded. If the case is concluded before the entire deposit has been used, the remaining amount is returned to the client.
The obvious negative side of this set up is that the client never knows exactly how much his or her case will end up costing. At least not until the case has been completed. The and lawyer can only guess how much work the case is going to require, and the client never knows exactly when their advanced deposit will reach a balance of zero. On most cases, some month require more work than other months, so a client whose deposit has only been billed $100 in one month, may find that their deposit has been billed much more the next month. It just depends on the timing and demands of the client’s case, and the uncertainty can be very unsettling for the client.
The one big benefit to hourly billing is that the lawyer gets paid only for time actually spent on the case. If the case settles early, the client obviously pays much less than if the case takes longer. However, some people believe that hourly billing encourages the attorney to put unnecessary time and effort into cases, or to make them last longer than is necessary. At Hagner Law Office, S.C., I do everything I can to keep my client’s fees as reasonable as possible, regardless of whether they are paying hourly, or on a flat-fee. Practical and professional legal advice does not have to cost an unreasonable amount of money. The client determines what their goal is for the outcome of their case, and I do everything in my power to achieve that goal as efficiently as possible.