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September 15, 2009

Ask the Attorney-Consultation Fees

Filed under: General — Paul Czech & Associates @ 7:55 am

As a follow-up to last month’s column on “how attorney’s get paid” I am going to discuss the payment of a consultation fee as I have received a number of questions as to when or if one should pay for a consultation with an attorney.

I am sure that you have seen the ads “Free Consultation” promoted by many attorneys. Often attorneys will utilize this method to entice potential clients into coming into their offices. The question then becomes what exactly does a “free consultation” mean. The majority of attorneys will place a time limit on the consultation generally anywhere from 15 minutes to a half hour. During this time most attorneys will listen to your legal issue and advise you what services they can perform for you and how much it will cost you. For the most part attorneys will not give you any legal advise whatsoever, no guidance and no insight as to how you could potentially resolve the issues without having an attonrey. The goal for most of these attorneys is to have you sign a Retainer Agreement and pay them an hourly rate for their services.

There are also attorneys who will charge a consultation fee for meeting with potential clients. My office is one that does indeed charge a consultation fee for you to meet with an attorney. The difference here is that when our office charges a consultation fee you are not “on the clock” and have as much time to discuss your legal concerns as you may require. You will also be provided a tremendous amount of legal advise and if a simple telephone call or letter will assist you in with your issues this will be included in the consultation fee. There are many people with legal concerns that certainly do not need to pay thousands of dollars to an attorney. For example if you are having a dispute with a landlord or a tenant, very often all you need is to be informed of exactly what rights you do and do not have. Or perhaps you simply need to have a letter sent by an attorney advising someone that you have Power of Attorney to make changes to an insurance document. You do not need to sign a Retainer Agreement and pay thousands of dollars to accomplish these goals. Finally, with my office if you do choose to retain our services you will receive a credit for the consultation fee paid towards your retainer. This means that you got the consultation for free. A consultation fee is a way of making a situation fair for everyone – a client needs some real advise and assistance and an attorney needs to be able to put food on their table .

That is not to say that there are not times when you should never be paying a consultation fee and it should indeed be “free”. When you seek an attorney because you were injured in a motor vehicle accident, you fell on a sidewalk or in a store, you were injured at work, you feel you were denied unemployment unjustly, you are seeking social security disability, and the list goes on, all of these situations would be handled by an attorney on a “contingent fee” or a “statutory fee” basis. As we discussed last month this is when an attorney gets paid only when you get paid. The attorney receives a percentage of any recovery that you obtain. If you do not get any recovery then the attorney does not get paid either.

As always please contact me with any questions and know that our goal is to give you a voice!

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September 7, 2009

Ask the Attorney-September 2009

Filed under: Columns from Our Towne Magazine, Entertainment Law — Paul Czech & Associates @ 3:59 pm

I don’t think I’ve mentioned this here before, but, aside from my usual work in my law firm, writing this column, and my various speaking and teaching engagements, I also host a radio show.  The show is called “Crumb’s Nite Out” and my co-host, Paul Rapp and I, tape the show each month at WAMC’s performance space and recording studio known as “The Linda” on Central Avenue in downtown Albany.  Paul and I (affectionately known as “the 2 Pauls”) invite guests in to have a roundtable discussion on various music industry related topics such as copyrights, licensing, recording agreements, etc.  We tape before a live audience so we allow questions and during last month’s taping there was an interesting one.  Our panel’s topic was “gigging” or, for the layperson, performing in clubs, and the question, presented by a young musician, was, “should I ask a club owner for a contract when I perform in their club?”.

Now that’s a pretty straight forward question that got a very straight forward answer but it made me think about how most people view contracts. Like our musician for example – when he goes off and “gigs” at a bar or club, he usually makes the arrangements directly with the owner.  If the musician can command pay, it’s usually very small, somewhere in the $50 to $150 range for the show.  He’s told when to show up and get onstage and told that he’ll be paid when he’s done.  Sometimes he gets paid and sometimes doesn’t.  If he had gotten a written contract for the show beforehand, would that be something that could be used to force the club owner to hand over the money?

The answer, of course, is no.  And that’s because the club owner not only knows the value of the document he signed but he also knows how much it will cost to enforce it.  For example, let’s say the contract guaranteed our musician $150 after he completes the performance.  When he doesn’t get paid, he’s going to find a lawyer to take his case for him.  Lawyers don’t work for free (and they shouldn’t) and our musician is likely going to have to pay a consultation fee to talk with his potential representative.  The case will have to be brought to small claims court and tried before one of the many Town Justices in the area.  Lawyers will charge fees of anywhere from $500 on up for such services depending on how seasoned an attorney they are.  The fee could potentially be as high as $1500 for the musicians day in court.  So far it looks like our musician friend is paying a lot of money for legal services with no guarantee that he will prevail in court which means that there is no guarantee that he will recoup any monies whatsoever.

I refer to situations like this as legal “grey areas”.  Legally, a contract like this is binding and valid.  The problem is, the contract guarantees such a small amount that it’s not worth anyone’s while to take legal action.  And, as far as the Courts are concerned, that’s a good thing.  Courts across the country are filled with litigants trying cases every day that involve matters that have a significant enough dollar value.    Can you imagine what kind of backlog there would be in the Courts if cases worth $50, $75, $100 were being tried on a regular basis?  Such actions would do nothing but paralyze an already slow moving judicial system.  And are you willing to designate your tax dollars to pay for the court staff required to adjudicate all of these cases?  I didn’t think so.

So, the truth is, the law doesn’t really have an answer for our troubled musician.  So the best thing that can be done is for our musician to develop some business savvy when dealing with club owners or anyone else for that matter.  No document in the world could ever replace common sense and street smarts.  If it stinks, it’s probably bad and, contract or no contract, there’s not a lot you can do to change it.

-Paul Czech,Esq.

September Edition of Rensselaer ‘Our Towne’ magazine

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