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Can you find cash for your clients?

by Carolyn Elefant on September 15, 2009 · 0 comments

in Marketing & Making Money, Setting and Collecting Fees

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Are there cases that you’d avid to handle but your client can’t pay your fees?  Before you send the client packing, consider whether there are ways to cover the costs of the case.

I’m not talking about litigation finance companies which can fund personal injury matters but come with their own set of perils.  However, if you’re a little creative you may find ways to get yourself paid so that your client doesn’t have to.

1.  Insurance Coverage: Ask clients who are being sued whether they hold an insurance policy that covers legal fees, or alternatively whether they have coverage through an employer or business.  If a client has coverage, hopefully, the policy allows for choice of an attorney.  But even if it’s likely that a client will be required to use an attorney selected by the insurance company, inquire about coverage anyway.  If you don’t and instead, take the case on the client’s dime, you might find yourself in the unfortunate situation of litigation boutique Zuckerman, Spaeder which has been sued by former client, professional wrestler Hulk Hogan for malpractice and overcharges to the tune of $1 million.  Hulk Hogan claims that the firm charged $1.5 million to defend Hulk Hogan in a civil lawsuit arising out of his son’s car crash, and failed to disclose that Hulk Hogan’s insurance company would have paid the entire cost of his defense.

2.  Fee Shifting Statutes: There are many fee shifting statutes under state and federal law which provide attorneys’ fees to prevailing parties.  Some, like Section 1988 (attorneys fees in civil rights cases) are fairly well known, while some are fairly obscure (right now, I’m pursuing fees under the Uniform Relocation and Real Property Acquisition Act that surprisingly allows for recovery of fees not just against federal agencies in takings cases but also against private parties which have a condemnation right under federal law).

3.  Intervenor Fees: The California Public Utility Commission offers compensation to intervnors in proceedings before the commission.  Are there similar programs in your jurisdiction?

Fee shifting statutes or public compensation programs are far from perfect.  First off, with few exceptions, you need to meet the definition of prevailing party to qualify for fees.  And even if you do, your opponent will likely challenge your request or you’ll have to wait to collect.  In addition, most fee shifting statutes still require you to provide an hourly accounting of time; a request for flat fees probably won’t pass muster (I’m all for flat fees but I’ll leave it to true rebels to try to convince a judge to award fees when a flat fee bill is submitted without any hourly accounting.  I’d rather get paid).

Do you have a favorite fee statute for getting paid?  Send your tips below.  I’ll feature the best tips and profiles of those who offered them in a follow up post.

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