Do you have a problem with your attorney's bill? If you're unable to resolve issues with your lawyer's bill, it may be a good idea to try fee arbitration before taking the matter to court.
Voluntary Fee Arbitration
Many bar associations offer voluntary fee dispute arbitration programs. This is an informal process for resolving fee disputes between attorneys and their clients.
To participate, you and your attorney must agree in writing to take your dispute to an arbitrator. An arbitrator is a neutral third party who hears all the evidence presented by you and your lawyer. The arbitrator reads over any relevant documents and reaches a written decision on what the fee should be.
Mandatory Fee Arbitration
In some states, you and your lawyer are required to participate in arbitration before either one of you can file a lawsuit over your attorney's fees. Mandatory fee arbitration is the norm in:
- New Jersey (where attorneys must agree to mandatory arbitration but clients can bypass the process and take their dispute directly to court)
- New York (for divorce cases)
- North Carolina
- South Carolina
- Wyoming (for contingency fee cases)
Binding arbitration means you and your lawyer are bound by whatever the arbitrator decides. You can't appeal or take the matter to court later. Nonbinding arbitration allows you to file a lawsuit if you aren't happy with the arbitrator's decision.
Arbitration hearings are less formal than court hearings. However, you should still be prepared to discuss the facts as you see them. Present whatever evidence you have in a respectful manner. Your presentation should be concise. Focus on why you believe the lawyer's fees are too high. It's especially important to steer clear of any personal attacks on your lawyer.
It's not appropriate to communicate privately with the arbitrator. Put your communications to the arbitrator in writing, and send a copy of everything to your lawyer.
If you have a witness who doesn't really want to come to the hearing, you may need to have the arbitrator or fee dispute administrator issue a subpoena. A subpoena is a written order that commands a person to appear at a legal hearing.
At the arbitration hearing, your lawyer will ask you questions during the cross examination. You'll be able to question your lawyer as well. The arbitrator may also have questions for both of you.
An arbitrator will consider many factors in deciding what an appropriate legal fee should be, including:
- The skill required to handle your case
- The lawyer's skill and experience
- What was at stake in the case and the case's final outcome
- Unknown circumstances that required the lawyer to spend more time than originally anticipated
- How much time the lawyer actually spent on the case
- How much time a lawyer of sufficient skill and experience would be expected to spend on the case
- How much thought and negotiation went into the fee agreement
- How much payment your lawyer has already received
The arbitrator will also consider written documents, such as:
- Fee agreements signed and understood by you
- Billing statements
- Correspondence about the billing statements
- Copies of cancelled checks showing your payments
- Other documents sent to you by the lawyer
- All documents in the lawyer's case file
If there isn't a written fee agreement, the lawyer is still entitled to a reasonable fee. This is based on what other lawyers of similar skill and experience charge in your local area. The arbitrator will also consider whether you and your lawyer came to an oral agreement on what his or her charges should be.
The arbitrator will likely take the matter under advisement. This means the arbitrator will issue a written decision or award within a reasonable time after the arbitration hearing.
When you receive the letter outlining the arbitrator's award, you'll also likely get information on your options after arbitration. It's especially important to note any deadlines you must meet in order to appeal an arbitration award.
If the arbitration is nonbinding, you'll have the option of refusing to follow the arbitrator's award and taking the matter to court. Even if you eventually end up in court, going to arbitration gives you a better understanding of the issues and evidence involved in your fee dispute. You'll also know you tried every alternative short of a lawsuit first.
Questions for Your Attorney
- Can you represent me at the fee arbitration hearing against my former attorney?
- How long do I have to appeal from the arbitrator's decision?
- What is the going rate for attorney fees in my area?