‘From the Client’s Chair’ is a blog post series that explores some of the ways law firms ‘misfire’ when trying to win — and keep — business. The observations are based on my experiences as a General Counsel ‘client’ who has selected and worked with hundreds of law firms over the years. So, let’s turn to…
The $30,000 Memo
Sometimes the client wants to buy experience.
My company was planning to sign a major contract negotiated by the Legal Team I headed. The negotiations had been arduous [that’s what happens when the other side has all the power], yet we’d managed to protect the company from an unreasonable amount of liability.
Or had we?
A slight risk existed that the wording of another section in the agreement could undo the liability protection we’d fought for.
I didn’t think that would happen, but it made sense to get a ‘second read’ of the contract by the partner at our outside law firm. We needed someone who’d ‘been around the block’ on these issues and, based on experience, could give us his ‘gut reaction’ on how the two contract sections would likely play out against each other.
That’s when the wires got crossed: Although we’d e-mailed our contract to the partner for review, he hadn’t responded with the blindingly fast ‘turn-around’ we’d grown accustomed to. Perhaps he was busy? We had other things to do ourselves. Besides –- for once — we weren’t in a time crunch and could afford to wait for his answer.
Ten days later, one of the firm’s junior associates (unknown to anyone on my Legal Team) e-mailed us a 10-page memo containing an all-state survey of the law on this issue. The answer to our question, after all of this research? ‘Well, it depends.’
But we already knew that!
Meanwhile, still no word from the partner. As if the taste left by this encounter weren’t bitter enough, when the firm’s bill arrived later that month it included $30,000 in charges for this academic, largely useless memo.
What I had expected to cost about $1,500 in legal fees ended up being 20 times more expensive. This is one surefire way of making a General Counsel seethe.
So, what’s the lesson for law firms here? There are several:
Be certain you understand your client’s expectations
Does she want to draw upon your years of experience and ‘gut instinct’? Or does she want a ‘bulletproof,’ comprehensive all-state survey of case law? Something in-between? If you don’t know, ask.
If your client’s expectations are unrealistic, tell her so –- in advance
Before you expand the scope of the assignment you’ve been given, discuss it with your client. Explain why the additional work is needed – and what the risks are, if it’s not done. If your reasons are compelling, your client is likely to listen. After all, she’s come to you in reliance on your good judgment.
Don’t drop out of the picture
Your client has contacted you — personally — for a reason. If you plan to use other resources in your firm to complete the project, let her know: Outline your approach to the project, tell her who else will be involved in the work (and why) and make personal introductions, as necessary.
Then, stay close enough to the project to know whether your client is getting good service. Check in with her occasionally to be sure.
Discuss the ‘M’ word
Money is not a forbidden topic. If it’s not discussed upfront, you risk putting the relationship with your client in jeopardy.
Make certain your client knows how your firm bills for its work –- and has an accurate perception of what the project-at-hand will cost. If in doubt, raise the subject with her and provide an estimate.
If the scope of the project expands along the way, provide your client with a revised cost estimate at the same time you’re asking her to approve the scope increase [see point #2].
And — never — send out a bill containing charges that might ‘sticker-shock’ your client, unless you have discussed the bill with her first. Pick up the phone and call her. (You can’t hide behind e-mail on this one.) Explain how the charges happened and that you didn’t want her to be surprised when she opened your bill.
This small courtesy of preparing your client for the ‘bad news’ will go a long way toward actually getting paid. And, at the end of the day, isn’t that the point?