How attorneys come up with their fees (or more accurately, how I come up with mine)
After more than a decade of working as a public defender and receiving a salary that was completely independent of the nature or number of cases that I handled at any given moment, my sense of the monetary value of my work became very warped. As my clients were never the ones to pay me, the very notion of how much I would charge for my services was completely foreign to me. Yes, I often heard about how I could be charging a lot of money for the work I was doing for my clients if I were in private practice, but I never appreciated how much my previous employer undervalued the work I was doing. When I made the choice to go into private practice many of my dear colleagues cautioned me about not undervaluing myself because a decade of giving the work away for practically free would likely lead me to sell myself short. That was important advice, but it didn't address an equally pressing question: how much DO I charge? Working as a public defender is not a business. I had no overhead and there was no anxiety whatsoever about more cases coming. When I chose to work in exchange for the salary and benefits my employer offered, my consideration was mostly "can I live on this and can I support my family on this." I was in it for the love of the work. More than ten years into my career as a public defender, I looked around and realized that the work I was doing was not the work that I loved any longer. I was barely taking cases to trial because I had gotten so adept at reaching settlements that my clients found worthwhile, and the caseload was such that I simply could not spare the time to pursue all of the interesting legal issues and challenges that I was seeing. The calculus changed. What my employer was paying me, although still enough for me to live and support my family, was no longer enough to justify my staying in a position that was not lighting me up inside. So the first question I ask myself when figuring out how much I will charge a client is how much I need to be making in order to support my family. Leaving the public defender's office meant I now had a whole slew of new considerations. I needed to pay rent for my office space, my bookkeeper, my utilities, research services, marketing, licensing, etc. I now had overhead. Part of the challenge of a law practice is not being able to predict which months will be slow and which months will be booming. Unfortunately, landlords, utility providers, vendors, etc. expect monthly payments to be made reliably and on time. So, when I figure out a fee to charge a client, I am trying to figure out how much money I need to bring in to pay all my overhead. In figuring this out, I look at how many cases I have open at the moment, how many more cases I feel I can take on without compromising the quality of the work I do for my clients, and how many of my resources will be expended on the particular matter in question. One of the greatest advantages of being in private practice over being a public defender is that I now have a say in what kinds of cases I take on and who I take on as a client. The more I want to take on a case, the lower the fee I am willing to charge to do it. Similarly, the more I want to take on a particular client, the lower the fee I am willing to charge him or her. As an illustration of this idea, I think of Charon. Charon in ancient Greek mythology was the boatman who ferried souls across the river Styx to Hades. The Greeks would put coins on their dead for them to give to Charon in order to make sure their journey to Hades was smooth. I often think of myself and what I do as being similar to Charon. The souls need to get to Hades. They can swim the Styx or they can pay Charon for a boat ride, but the journey needs to happen. Similarly, the people who come to me do so because they are dealing with a situation that is going to need to be dealt with. Yes, they could try doing it by themselves (they can swim) or they can get in my boat and have a much better experience getting across. What I charge them will be a function of the "journey" I anticipate signing up for. So how much I want to take on the case/client is a factor. Directly related to the question of how much I want to take the case/client on, is the question of what the impact of taking on the case/client will have on my ability to take on other cases and/or clients. If a client comes to me charged with a complex felony matter that I reasonably expect will take more than a year to resolve, I need to be sensitive to the fact that taking that case will make me less available to take on a future case that is as onerous. Looking at the caseload I have and predicting the caseload I expect to have is a big factor in how much I will charge as my fee for any given case. Lastly, but of no lesser importance, is the question of what other attorneys charge for similar work. When I was figuring out a sort of base rate for various types of cases, I literally asked colleagues whose practice and style I respect how much they charge so that I could have a sense of what the "going rate" is. There is nothing that requires me to charge the same as what other attorneys charge, but if I were to charge a lot more than what similarly experienced and skilled attorneys charge, I could expect to not get a lot of business. Similarly, if I were to charge much less, then I would get a lot of work, but be leaving money on the table. As with all businesses, a law practice also needs to be sensitive to supply and demand. So in summary, there are many factors that go into determining how much I will charge as a fee for any given case. I need to be charging enough to make a living, I need to be charging enough to cover the business's expenses, I need to be charging enough to make taking on the case or client worthwhile, I need to be charging enough to compensate me for my time that I will not be available to work on other matters, and I need to be charging enough to remain competitive in the market. I wish law school had better prepared me (or prepared me at all) for these considerations. They call it the practice of law and I like to joke that we are all practicing to make perfect. The business of law is its own thing and now you know a little more about how I go about it. If you know anyone in need of an experienced and creative criminal defense attorney who does not take the question of how much he charges lightly, please give them my number as I would love to speak with them.