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- Litigation Strategy - Preliminary
- How an Attorney's Litigation Experience Can Help the Client
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- Discussing Fees & Expenses
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- Useful Legal Doctrines
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Discussion of Fees and Expenses
Hourly Rate Litigation
My hourly rate is $425 or more (subject to change), depending on the type of case and the ability of the client to pay, among other factors. In contrast, the hourly rate charged by major law firms for the top partners specializing in big-ticket litigation ranges from about $700 to $1,200 per hour as of 2014. See Law.Com Article on Fees Charged by Major Law Firms. The hourly rate in 2005 for associate attorneys experienced in big-ticket litigation in New York City ranges from about $375 to $530 per hour. [Data obtained from the Billing Rates for Junior to Senior Associates" section of "The 2005 Electronic NLJ Billing Survey" - requires free subscription to review.] This amount has increased. For current information see wikipedia, at Wikipedia Article
Several important considerations need to be taken into account when comparing hourly rates: (1) whether the attorney knows what to do, because an inexpensive attorney not knowing what to do often becomes a financial disaster when the attorney tries to learn at the client's expense and winds up charging substantially more and not doing the legal work properly; and (2) the level of experience doing the type of work required to be done, because an attorney who has done the required level of work various times spends a lot less time doing the work (at high quality) once again than someone who is trying to create quality work for the first time. These factors are often the justification for one attorney charging, say, $500 per hour, and a lesser skilled, lesser experienced attorney charging, say, $175 per hour. The thing to focus on is the cost and results, not just the hourly rate. If an attorney does not know what to do when starting out with a new matter, he/she may not ever learn.
My 10/26/16 observation: I have developed since 2008 a skill in handling foreclosure defense (residential as well as commercial) and I have analyzed thousands of matters during this 3,000 day period. I'm able to spot meritorious foreclosure defense issues without the need to do expensive legal research (since i have already done this for various clients over the years) and I am also able to recognize and discount issues that I know the Courts have rejected. It might take me 5 seconds to discard a defense that an attorney new to foreclosure defense work might spend 5-10 hours to develop, with no hope of winning. The value to my clients I understand, even if many clients don't understand this value. I spend whatever time is needed to be spent and no more, because I have other clients waiting for me to work on their matters. I am able to help more clients at less cost to them because of my ever-growing experience. For any client seeking a foreclosure defense attorney it would probably turn out to be a disaster to hire an inexperienced attorney for free or a $1 or $10 or $100 per hour because of the damage that such attorney would probably cause to the defense. Foreclosure defense has windows of opportunity and if what should be done while such a window is open is not done, the client loses that right. For example, in New York State, if the Bank in its complaint pleads that it has the original note, and the client's answer DENIES this allegation, does the Client have a right to argue that the Bank does not have the original Note? What would any logical person (Client, Attorney, or Other Person) expect?
The Answer as to Expectation: Yes, the Client should be able to contest whether the bank owns the original Note.
The Actual Answer: No, the Client and his/her ill-advised attorney have forfeited or waived the right to contest this issue and have lost the right to contest the standing of the bank to commence the foreclosure action because in New York the standing issue (of not owning the original Note) can only be raised as an Affirmative Defense. Too many pro se litigants, many with help from uninformed attorney volunteers to help pro se litigants, and too many real estate lawyers attempting to represent their transactional (real-estate closing) clients in litigation have failed to put in the required affirmative defense and the bank has obtained foreclosure without owning the note because of the lack of knowledge of the person handling the foreclosure defense. This is only one problem. There are many problems, and the Client really needs someone with substantial experience to have the best chance of saving the home, and to do so at the least cost - because the use of a low-cost attorney with no experience is going to cost a lot of additional fees to try to correct the errors, but usually these last-minute effots to save the home are rejected by the courts and the homeowner winds up with higher costs and no home, because he/she started out pro se or by using an inexperienced, low-cost (or no-cost) attorney.
Some types of litigation make it possible for a law firm or attorney to provide a fixed fee for a described part or even all of the legal work to be done. Insurance companies do this to a great extent by having a scheduled fee for the type of work done, irrespective of the hours such work ultimately takes. This approach can be applied to cases not involving insurance carriers. My practice is to discuss with the potential client the litigation events that are expected to take place and my fee for each of such events, separately stated. There will undoubtedly be certain possible litigation events requiring identification which would not be covered by the fixed fee representation agreement.
Combination Hourly-Rate and Contingent-Fee Litigation
One way to reduce the immediate cost of litigation for a plaintiff seeking monetary, injunctive or other relief is to provide a contingent fee for accomplishment of a stated goal (such as obtaining a preliminary injunction), and charging a lower hourly rate for all of the hours of work performed. This would reduce the legal expense if the action does not succeed as desired, and increase the overall legal fee for litigation success, but providing the law firm or attorney with its costs, more or less. I am willing to discuss this type of fee arrangement with potential clients, including a contingent fee for obtaining dismissal of a case brought against the potential client.
Contingent-Fee Litigation with 1 or More Fixed-Amount Payment(s)
Contingent-fee litigation when 100% contingent fee is most appropriate when representing a plaintiff in an action where the defendant has (or probably has) insurance coverage. This type of case is generally settled to a much greater extent that a commercial lawsuit or similar type of litigation such as securities litigation, Sarbanes-Oxley litigation, antitrust litigation, patent or copyright litigation and major breach of contract litigation, just to name some prime examples.
When the case has no insurance coverage, the defendants tend to be more willing to litigate and less willing to settle, for one main reason: to discourage other lawyers and plaintiffs from suing the defendant on similar grounds. Insured cases don't have that potential (other than when fraud is being perpetrated) because the insurance cases generally involve some personal or commercial disaster or injury which happens by accident and can be defeated if caused by fraud (such as a landlord torching his/her own buildings to get around landmark restrictions imposed on the building or property).
100% Contingent-Fee Litigation
Also, as already explained, there is the 100% contingent fee litigation. In some cases, an attorney might be willing to take on a case with a 100% contingency (other than insured cases) because of the prospects for the award of attorneys fees at the conclusion of the case, if the attorney wins. In non-insurable types of cases, such as antitrust, breach of contract, copyright infringement (assuming errors and omission coverage isn't applicable), the possibility of having the plaintiff's complaint dismissed or the action dismissed by summary judgment is too high to enable most attorneys to take on this type of case on a 100% contingency. Instead, having a fixed fee up front with a contingent fee upon success or a low hourly rate with a contingent fee upon success is a more appropriate way to handle such a case, and will be of interest to more attorneys than a 100% contingent fee case.
In any of the types of fee arrangements, the attorney (including myself) generally wants to have the disbursements or "out-of-pocket" expenses covered by the client, and this would be part of any fee agreement. There could be a separate fund (held in escrow or an attorney's IOLA account) to cover the expenses, or expenses could be billed and paid on a periodic or other basis (such as monthly or when the unpaid expenses reach a certain dollar amount). In the event of non-payment of expenses, the fee agreement probably would give the attorney an opportunity or right to apply to the court for permission to withdraw as the attorney. On the other hand, an attorney can be expected to act reasonably under the circumstances and protect his/her contingent fee by continuing with the representation when the client becomes unable to pay certain expenses. It is best for the client to alert the attorney along the way about any financial inability to handle expenses, to give the attorney time to implement changes that can save money for the client (such as by taking depositions by telephone for a short period at a total expense of perhaps $250 - not including the legal time - in contrast to the major law-firm way of sending 2 attorneys to a distant city for perhaps 3-9 days of legal time plus a $3,000 to $10,000 deposition expense (especially when having the deposition taked with a court videographer).Last Revision: 10/25/16