Competence and Diligence in an Uncertain Legal Landscape with Craig Dobson

Stephanie Everett: 

Hi, I’m Stephanie. 

Zack Glaser: 

And I’m Zack. And this is episode 5 54 of the Lawyerist Podcast, part of the Legal Talk Network. Today, Stephanie talks with Craig Dobson about ethical traps in pricing and representation. 

Stephanie Everett: 

Today’s show is brought to you by my case, so stay tuned. We’re going to talk to them in just a few minutes. 

Zack Glaser: 

We have a coaching program we like to talk about, we like to do. We like to provide services for, obviously we do lawyer lab coaching. We have another product coming out that’s a little more like a sprint, a little more specific, maybe going to hit some of the listeners right in the fields, I guess, of like, oh, that’s me. Can you talk a little bit more about, it’s reset, right? 

Stephanie Everett: 

Yeah. We decided real simply, we’re going to call it reset and it’s going to be a four week sprint for people who need just that, maybe they need a reset with their firm. Sometimes we come across people and they’re not sure about their marketing. Are they attracting the right people? Are they focused on the right segment of the market? What’s missing? Other times when we talk to people, maybe they’re worried about pricing, are they under pricing? Have they scoped their services correctly? And then the third topic is maybe they’re wearing too many hats and they need to delegate, but they don’t know how to get started. Should they outsource? Should they hire a va? Should they hire a person? So we decided what if we take those three things that we know people get stuck on all the time and slam them into this really intense four week sprint where we are going to, pardon my French if you have little ones in the car, but we’re going to get some shit done. 

And the cool thing I think also is we’re going to teach the lawyers in the program how to leverage some of our favorite AI tools to actually get the work done. So it’s not a course on AI by any means, but we’re going to just show you hand in hand the things that you and I and our guests are always talking about on this show. How do you actually use this in everyday life? So we’re going to really leverage those tools. I think in the marketing materials, we said AI is going to be the crowbar. How do we get this so that people come out of these four weeks with work done and progress made? 

Zack Glaser: 

Yeah, that’s what I wanted to kind of ask two questions. One is, who is this for? And then the other is, what does done look like with this? 

Stephanie Everett: 

Yeah, I think, who’s it for? So on small firm lawyers who are maybe stuck in that little, I’m too busy to fix anything phase. Maybe they know they’re doing the things but it feels off or they haven’t had space or time or the systems to fix it. And who it’s for is someone who’s ready to take some action. 

We’re not going to wait for the perfect time anymore. You just need to dig in. It’s messy and let’s just go figure it out and get your business moving forward. What done looks like is you’re going to come out of this with some pretty clear takeaways, marketing clarity, so you know exactly who you’re trying to serve and marketing plans. We’re going to guarantee you a big bold marketing move that you can implement. In week one. You’re going to come away with revenue optimization report so that we can hopefully unlock more money, fewer hours for you, get more done charge. Maybe we need to adjust your pricing or your scoping. We’re going to look at all that. And then finally, you’re going to come away with a scalable ops system. So the idea is that you could take some time back and you can know exactly what you can get off your plate and how to get it off your plate very quickly. 

And then finally, we’re going to have you leave with a 90 day work plan. So as a bonus at the end, a lot of this gets delivered through email work, and then you come onto a call once a week as a group with our coaches. You’re going to have access to our private Slack channels. So we’re going to be talking you through the whole thing, but then at the very end, you’re going to follow it up with a one-on-one coaching session with one of our business coaches. We want to make sure you have a clear 90 day plan and that you’re leaving this four week sprint knowing exactly what’s next for your business. So it’s jam packed. I feel like I just said a lot, but don’t let it intimidate you. The goal is, I think you said it best. Maybe this is the kick in the pants some people need. I get it. It can be scary or overwhelming or all the things, but this is your chance to come work with us for a month and make some real changes. 

Zack Glaser: 

Now here is our conversation with our sponsored guest, and then we’ll head into Stephanie’s conversation with Craig. But before you do that, before we go into that, and while maybe you’re thinking about all the amazing things that you can take off your plate through this program, head on over to Apple Podcasts and leave us a review. Hey, Y all, it’s Zack, the legal tech advisor here at Lawyers, and today I’ve got Curtis VanderGriendt with me from ape MyCase, LawPay, Case Peer, all that family of affini pay products, and we are talking expense tracking within your case file. Curtis, thanks for being with me today. 

Curtis VanderGriendt : 

Thanks for having me. I appreciate it. 

Zack Glaser: 

So Curtis, when I was practicing, I didn’t really have to think too much about expense tracking. I thought about it in a grand sense as opposed to on a granular sense within specific files, but that is a pain in the butt. 

Curtis VanderGriendt : 

I think that’s an understatement for a lot of people that are probably listening to this and have to deal with it on a daily basis, 

Zack Glaser: 

Right? 

Curtis VanderGriendt : 

Yes. Whether you’re a solo attorney that’s running everything and doing it yourself or you’re an office manager chasing down people and receipts and things like that, it’s a giant pain in the butt. 

Zack Glaser: 

Yeah, we’re talking about things in PI cases where even if you’re doing things that are not specifically hourly, but we’re also talking family law cases and really even if you’re not charging by the hour, because we have this big thing hanging over us right now about how we probably need to be starting to move away from the billable hour, but even if you’re not charging by the hour, we still need to know our expenses, but then also get ’em paid. I mean, I think about how a contractor comes to my house and charges not by the hour, but they charge cost plus they want to make sure that they’re getting their costs paid. So what are our kind of issues? The common issues help me as the person that’s never had to do that. See the common issues here. 

Curtis VanderGriendt : 

I think for me, having talked to dozens if not over a hundred customers at this point about this problem as we’ve been digging in and finding the right path to a solution, is I see it as kind of two things. At a high level, it’s time or money or both. So you’re either wasting a ton of time chasing receipts and making sure that you’re billing all of these expenses that you’ve paid out on behalf of clients or you’re just letting them fall through the cracks and not actually getting that money back. And so you’re wasting a lot of money and there’s profit leakage and there’s money falling through the cracks when you’re billing your clients at the end of the day. 

Zack Glaser: 

Yeah, I mean, we already have a problem with not billing our clients even for our work, much less when you show up and I had a card for court costs, I had a card for operational expenses, when I would show up to court and get copies of something even I found and I wasn’t tracking my expenses, even I found that these expenses, you’re out doing something, you’re practicing law, you’re trying to get something done. You have multiple people that have access to an expense account and keeping that within, I mean, just accounting for it in general, much less accounting for it within a specific file. So alright, I think we’ve convinced people that there’s an issue here. 

Curtis VanderGriendt : 

I can just imagine the nodding 

Zack Glaser: 

That’s going right, right. Just nodding, going down the road, nodding this. Alright, can, I mean obviously we’re talking with you about fin pay my case, what’s a better way? 

Curtis VanderGriendt : 

Yeah, happy to talk about this. This is our brand new product that we’ve got in early access right now it’s called Smarts Spend. So my case Smarts spend that integrates directly with our practice management product. And what this allows you to do is issue corporate cards to your staff and immediately be able to be prompted and link those to cases and upload receipts and have that confidence that every advanced cost on behalf of your clients is going to show up on the next invoice. 

Zack Glaser: 

So I’ve got a card issued to my staff that is connected to my practice management software that so when I spend on that card, I have to go account for it within that software. 

Curtis VanderGriendt : 

Yes, because owners or administrators within the firm will be able to see every transaction on every card. They will know who spent that money and then they can see if it’s been linked to a case or not to ensure that those advanced costs are getting reimbursed. The other thing of this is it’s not even all about advanced costs for clients, it’s general firm spending too. I’ve talked to numerous office managers or firm owners that don’t know how much they spend on a monthly basis on marketing or software or office supplies, whatever it is. They just pay the credit card statement at the end of the month and they don’t really know where the money’s going at a granular level. 

Zack Glaser: 

And I think that’s important to talk about here. My case specifically is kind of an all-in-one accounting has all-in-one accounting inside of it. So you are dealing with your general firm expenses, which I think is important here because that’s how we track things, that’s how we run reports. You can run better reports on something when you’ve got all the numbers in there. So when I’m issued this card, my first thought is, well, nobody’s going to take this card. What kind of card are we talking about? What kind of credit card are we talking about here? 

Curtis VanderGriendt : 

Sure. So this is an actual credit card. It’s the LawPay Visa business card. And so with this, you’re able to have an overall firm credit limit and that is shared amongst the number of issued cards within the firm. So the owner can have one, a paralegal could have one office manager can have their own, and you can set custom spend limits on each card depending on what you want it to be used for. Like you mentioned, you could have a purpose specific e-filing card for all e-filing for example. So you can get creative with how you issue these cards and how you use them, whether they’re sort of general purpose for all firm spending or if you want a dedicated card for certain types of purchases. 

Zack Glaser: 

So as far as the rest of the world is concerned, the people that I’m spending the money with, this is a credit card, so this a Visa credit card looks like everything else, but from my standpoint, I can get really granular and it just integrates right into my law practice. I don’t even want to say integrates right into my law practice software integrates into my law practice because again, that from my perspective is what LawPay and Fin Pay brings to the table is this ability to think about this financial stuff for really technical term there this financial stuff from the perspective of a lawyer, 

Curtis VanderGriendt : 

Exactly like here at AIP Pay with this product, with SmartSpend, our mission is all about making business operations easier for law firms. So it goes beyond the practice of law and it’s really about the business operations of law. We want to make things efficient and we want to help our customers to be profitable. So however we can do that, whether it’s time and productivity or it’s actually money flow and money coming in, money going out, that’s what we want to do. Focus on serving your clients and we’ll take care of the business operations side. 

Zack Glaser: 

Fair enough, fair enough. Alright, Curtis, where can people find more information about my case and smart spend and all of this? Because they’re chomping at the bit, they’re in their cars, they’re on their phones while they’re driving, 

Curtis VanderGriendt : 

Where can they go? Absolutely. Yeah, go to our website, go to my case.com. Under there, under Products and solutions, you’ll see information about spend management and how you can join the wait list. So if you’re my case customer, we will quickly get you in there once you join that wait list for those that aren’t consider getting my case because you do need to be my case customer right now to access Smart Spend because of that integration with our billing and invoicing and adding all of those advanced costs to your client bills. And those cases 

Zack Glaser: 

Easy enough. Go to my case.com and check it out. Curtis, thanks for being with me and thanks for helping me dig through some of this today. 

Curtis VanderGriendt : 

No worries. Happy to be on. Thanks for having me. 

Craig Dobson: 

Hello, I’m Craig Dobson. I’m an ethics and professional responsibility lawyer, so that means I represent lawyers who have disciplinary complaints and I also help lawyers avoid disciplinary complaints through a subscription plan. And some people just keep me on retainer and call and ask me questions about whatever’s bothering them. 

Stephanie Everett: 

And you also do some immigration work too, right? 

Craig Dobson: 

Also do some immigration work and then an immigration lawyer is my most common type of client, probably an asylum lawyer is even to be even more specific is my most common client. 

Stephanie Everett: 

I love that. That is a very specific niche or I say niche. We’ll go with that. I don’t know. All right, we, Craig, I am glad to have you on the show today because you and I, you’re in our lab program and we were talking a couple of weeks ago and there’s just some really interesting things happening in the world today, and I think your perspective is really going to help our audience. And so maybe to kick us off as wearing your immigration lawyer hat, I think it’s fair to say there’s a lot of changes happening right now because of the current administration, and I suspect in a way it’s almost like every administration brings some changes, and you guys are obviously feeling that a lot right now, but maybe other lawyers, maybe other practice areas are feeling that too. Like, gosh, we just don’t even know laws are changing, rules are changing. How do we keep up? And I guess I was just kind of curious on your insight into that because it can feel little stressful maybe. 

Craig Dobson: 

Yeah. So yeah, you’re right. There are changes in every administration this time more so I think one of the things we were saying after the election in November is the president can’t change the laws. That’s what my colleagues and I were saying. But I think many of us are surprised by the kind of aggression with executive orders and so forth, and challenging laws, for example, challenging the very citizenship of somebody, a non diplomat who’s born on US soil. So there’s a lot going on. The change is more dramatic, the uncertainty is higher than we had expected, so it’s a little more than we have seen in the past. So yeah, one issue is how do you keep track of all this? So I wrote an article a few years ago called Keeping Up with Competence, and by the way, I would even back up further to say in immigration law, the biggest ethics issue I see is competence. 

So there are all these complicated ethics rules around how do you advertise, how do you charge an appropriate fee, all those things. But really a lot of it just comes down to how do you become competent and stay competent? There are a lot of issues with there’s how do you self evaluate your competence? That’s an interesting topic to me because compared to if you’re a plastic surgeon, you train for many years, you have all these people observing you and then you take a test. Whereas with immigration law, even to a degree when you work for somebody, so how do you stay competent? I think one way is I think it’s really hard to be a confident immigration lawyer without being a member of a LA. I think there probably are some really great lawyers who are not a member of a LA, but it’d be really tough. 

So there’s an email that I get every day 6:00 PM called a Daily Eight, and it talks about the most important things I need to know. Admittedly, sometimes item seven on the agenda is buy our new book. But usually item number one is something pretty serious. It may not be necessarily in my practice area, but I would say if you’re an immigration lawyer, join ala, get that email and put that on your daily checklist. We had an incident maybe a couple three weeks ago where the administration changed a form type on a single day, didn’t issue a grace period. So there’s a really prominent lawyer talked about having lots of FedExs that had been issued and then they had to be called back to his office and then a few days later a grace period was granted, but the lawyers didn’t know it at the time. It affected only one of my cases, but it was extremely stressful. It required redoing a form because I didn’t know there was going to be a grace period aggravating a client asking a client to sign new documents. There’s a translator involved. So that added more so. Yeah, so there’s a lot going on. So that’s just one example of how to be confident. 

Stephanie Everett: 

Yeah, I think the competence question though, I mean you phrased it in terms of immigration. I often think about it too. I see a lot of lawyers come to me and they say, I want to be an estate planning attorney. That looks pretty easy. You don’t have to go to court, you don’t necessarily have to go to court. You can do it on your own schedule, flat fees. There’s a lot of good reasons, but there’s a lot of tax implications when we start to uncover any practice area has a level of knowledge. We don’t like to use that word expertise, but I think it’s a good reminder that you just gave us that. It’s another reason too why you should maybe think about specializing. I also hear from a lot of lawyers, they come to me and they’re like, they name off four, five different practice areas. And I’m like, those are five different businesses. So in addition to having different marketing strategies and onboarding strategies and forms and ways you have to deliver the client services, you’re also reminding us you have to stay competent in all those areas. And that could be tough when you’re a smaller firm. 

Craig Dobson: 

Yeah, I mean maybe if you’re literally a genius, maybe you could do that, but otherwise it becomes pretty difficult in modern times to focus it. But that’s a perfect example you gave though with the tax law. Assume you read and study a lot about wills, estates and trusts, and you don’t realize there are these huge tax implications that you just missed. Same risk in immigration. You might think you know everything. What are the unknown unknowns? I think that Rumsfeld, the former defense secretary said that maybe quoting somebody else, but that’s a scary thing. So that’s maybe one way to become competent if you want to become a trust lawyer, maybe affiliate with somebody. But again, there’s that self-assessment. How do you know when you’re competent? 

Stephanie Everett: 

I know that’s a big burden. I know it scares people. What else should lawyers be thinking about when they’re kind of thinking about some of these ethical issues that pop up that you see often? 

Craig Dobson: 

Well, there’s competence and then there’s diligence. And I think the two go hand in hand. And here’s the way this works to me. So the ethics rules actually say you can take on a case that you’re not competent to handle, but you have to become competent. One way you can deal with the issue is you can affiliate with a lawyer. Another way is you can become competent through study, but that’s how it relates to diligence. Can you become competent quickly enough so that you don’t violate the diligence rules? So I could probably figure out how to do neurosurgery if I had from now until the end of time, but you have to learn within enough time to actually do what needs to be done. So that’s one question. Can you become competent quickly enough to be diligent? And then there’s all this underlying study that has to take place before research can be done effectively. 

So I am thinking of a research project. I won’t name the law school, but is an elite law school who was engaged in a research project that I was involved in, and the lawyer, really bright lawyer to be did some great research, but there were some pretty big gaps in the research. Again, had to do with immigration law, but part of the reason is they didn’t have that underlying foundation so that they could even do the research effectively. So there’s some lawyers who will say, for example, I’m going to handle this new practice area. I’m a lawyer, I’m going to do some research. I’ll figure it out. That may be the case is for example, if you’re already a wills and estate and trusts lawyer and you’re doing something within that field that’s slightly different, that’s one thing. But if you’re learning a new field entirely, you really have to have a foundation before you could even do things like research and maintaining competence effectively. 

Stephanie Everett: 

It’s a good reminder. Our profession, it’s a hard one, especially in light of all the tools and resources that are out there that are like, oh, just buy a subscription to this plan and you’ll get the forms, you’ll get the documents that you need, and that can be tempting to do. But remembering you should understand what all the language in those forms means and says and the implications or the implications of what could be missing. So there’s a high burden there for us in our profession. 

Craig Dobson: 

Back to the immigration example, I hired a new paralegal this week, so I sent her a paper that I wrote. It’s about a seven page paper on one question on one of the immigration forms. Have you ever committed a crime or offense for which you have not been arrested? But one of the reasons I sent that to her is to give her the idea. It’s not just a simple question. There’s law behind it, there’s reasoning behind it, but you could have the misunderstanding that it’s just simply reading a question, giving a common sense answer and moving on. But there’s more to it. I’m sure that’s the case in many other fields too. 

Stephanie Everett: 

One of the other things that I know that you’re talking a lot about that it really resonated with me. As you know, I’m a big fan of killing the billable hour. Everybody that listens knows that. That’s no secret. But also as you and I were talking recently, for example, if we set flat fees, which many immigration attorneys have done, they probably set those fees based on the situation that existed at the time they set their fees, which might’ve been in this case a prior administration’s rules. So if I think that this type of visa application, clearly I’m not an immigration lawyer, I’m just trying to go with an example. If I know this is the process, it takes these steps and this is how long, and this is the situation, I might price it based accordingly. Well, now we have a new administration in here and the process may have been completely changed. So that could be a scary thought for some. And this is probably applying across the board even beyond immigration, but it’s just a great example of one, as a business owner, how should I be thinking about that? Because am I locked into what I priced in the before? Can I make changes or how do I even start to think about that process? 

Craig Dobson: 

There’s an inherent conflict of interest about the money when someone hires you, but the rules allow for it. If the rules didn’t allow for it, it’d be hard to practice law, right? So the question is though, what happens after the representation begins? If you went back and renegotiated a fee, what kind of conflict might there be at that stage? Particularly if you’re raising fees. It’s one thing if you agree with the client to lower a fee for some reason, but if you’re raising fees, of course, that’s where the concern really comes in. So the risk really would be most on a lawyer who’s quoted a flat fee and says it’s just all inclusive and they don’t provide any exceptions in their engagement agreement. So let’s assume for a minute that has happened, so I won’t name all the details of it, but to do something other than immigration for a second, there was a DUI case that was taking place in, I think it was in dc. 

And so the lawyer had lots of cases where they settled, negotiated, and it was quick, easy for the DUI. They would charged flat fees and then all of a sudden they had a case that was going to go into a two week trial. And so the lawyer went to the client and said, I need to raise the fee. And the client said, no. And then the lawyer, I can’t remember exactly what, maybe the lawyer refused or there was a dispute is some way the lawyer compromised the client’s position and they got into ethics trouble because the ethics authority said it’s a flat fee, a deal’s deal. It might’ve been appropriate for you to ask the client, but the client also had the right to say no. So I wrote a paper on this. It’s called How to Ethically Change Fees Midstream. And one key question is whether the really specific conflicts at 1.8 a applied. 

So I found one state, I can’t remember which one, maybe it was Idaho, but there’s at least one state that says in the comments that 1.8 A applies. What does that mean? If you’re in the middle of a case, you ask the client to change fees, particularly nobody’s going to have a problem with lowering a fee, but raising a fee, do the strictures of that rule apply? Which means you’d have to advise the client to go seek their own independent counsel, give them the time to actually seek their independent counsel. The request would have to be reasonable. So part of what 1.8 A would actually ask of you or require of you is to even ask the client about raising the fee needs to be reasonable. So one of the ways you could at least help out in that category would be to put in your engagement agreement, something like we reserve the right to increase the flat fee based upon a change in the facts or law. 

You’d probably make it more elaborate than that, but at least say something. And so what we found during the previous Trump administration, which prompted my article to be written, is there were lawyers who would quote a flat fee. They wouldn’t have anything in their engagement agreements to allow them to raise the fee as part of the reason you like the flat fee is people want that certainty. So one solution, other than maybe doing what I just described, putting some kind of provision that gives you the right to raise the fee would be to charge a really high flat fee. A reasonable has to be reasonable, of course, but a really high flat fee. So the risk would be lower on the lawyer, but at least that client gets the certainty of what the fee is. And then another thing I’ve heard, I think it was Greg Siskin who once said that you have to think about three things, the fees, the speed, and the quality, and you have to have at least two out of the three. 

So if you’re charging a high fee, you better be fast and have high quality. So if you can deliver both of those things, maybe it warrants charging a high fee and maybe that’s protection kind of built in. On the other hand, let’s say you charge lower fees, lower flat fees, you really need to be careful because what if a change happens? According to my understanding, during the previous administration, there were firms that were facing bankruptcy because they had quoted these flat fees that were on the lower end already, and then they didn’t have provisions in their agreement to be able to raise the fees. And there’s a Florida ethics opinion that I like to talk about that says it’s the opposite of what you would normally hear. You have to charge enough to do the case properly. So we talked about competence and diligence already. 

You have to charge enough money to do the case competently and diligently. So there’s some people who call me and they feel as though they’re doing a public service, but there is that floor that you can’t drop beneath. So if you, you’re Kim Kardashian, who may soon become a lawyer, you don’t have to charge any money at all. But for most of us, we have to charge enough money to do the case properly because we’re in business to help people, but also to make money, we have to make some money to pay our staff and ourselves. 

Stephanie Everett: 

Yeah, it’s a good reminder too. And I think the DUI lawyer example, I always tell people, you have to look. I mean, it’s easy to go in on one case and be like, oh, they love to say lose money on this case. I argue with that because that’s not the true sense of profitability mean, but we’ll say that argument for a different day according to your business, but you got to look at a portfolio. So if you’re doing DUI work, out of the 50 or thousand cases you do in a year, are they priced right? So do you have enough that maybe one or two or however, a small number are going to take a lot more work than most, but as a portfolio, it’s priced and you’re making money. I think though what you’re describing, which is super interesting, that in the immigration example, people’s entire portfolios were now priced wrong because the situations externally changed. And so maybe they were okay in the before, but now it’s like, wow, our whole scheme is out of whack because of this external thing we didn’t think through and we didn’t protect ourselves with that language. 

Craig Dobson: 

Yeah, that’s exactly right. It affects the whole portfolio. And then there are options in between where you would say the flat fee covers this, we call it a hybrid fee, but the flat fee covers X amount of work. You could really even itemize what the flat fee covers, but then the additional work is billed hourly. You have to be careful there though to make sure you don’t abuse that. And also, by the way, if you read my article and you look at applicable state rules, you still want to make sure when you do a fee increase, in my view, it ought to be proportional what the original flat fee was, right? So you shouldn’t go from being a Walmart style lawyer to premium lawyer in your fees. Yeah, Nordstrom 

To Nordstrom, when you’re changing a fee midstream, it’s probably going to be hard enough on the client as it is to change a V. You don’t know their situation. There’s still the possibility that they come back and say no, and then you’re stuck with that, except that if you’ve drafted a provision that’s sound enough and someone has, I’m working on a case like that now, if the provision is sound enough, it should allow you to make a reasonable fee increase. But that’s really the key. Did you put that in your agreement? Is it truly depending on the wording of it, is it unforeseeable for example? That’s one of the, and then the unforeseeable aspect of this, let’s assume you don’t have any provision in your agreement what was unforeseeable prior to the previous Trump administration and immigration might not be unforeseeable this time. That’s my view. I think some people disagree with me, but I think you could take the position, you should have learned your lesson the first time, at least on that unforeseeable aspect. But who knows, there’s still things that might surprise a reasonable lawyer. 

Stephanie Everett: 

Yeah, I think it’s good whenever we’re thinking about those flat fees, which I’m a big fan of, but I always say you’ve got to be clear in how you scope it and how you talk about it. And even the tallest skyscraper in downtown, they had the ability to do change orders. And we all know this too. If you’ve ever built a house, suddenly you think this is the fee for the house. And then they come in and say, well, do you want this tile or this tile? And like, oh, or if I want some upgrade, I want some change, it’s going to cost more. And I think we have to build in those protections for ourselves when we do that because there could be changes. And not that we want to totally surprise the client, we don’t want to sandbag them either and promise them this low price knowing we’re going to keep adding on, but at the same time, real things can happen in our work and we need to be prepared for that. 

Craig Dobson: 

Yeah, it makes very good sense. Yeah, I think it makes very good sense. You could have, and there are instances where, like you said, don’t sandbag the client. I’ve heard of firms who will take a really low flat fee knowing well that they’re not going to do a very good job knowing that there could be additional work that’s required because they didn’t do a good job at the outset that they can then charge by the hour. That’s not a good practice. So that’s going to harm the business longer term. So yeah, you really need to have some flexibility, but really, really don’t abuse that. 

Stephanie Everett: 

Any other kind of big gotchas that we should be thinking about when we’re kind of dealing with some of these issues? 

Craig Dobson: 

Well, yeah, maybe a couple things. You mentioned limiting. So the two ways to think about this. When you do a flat fee limiting the scope of the representation, usually under a rules, that’s a model rule, 1.2 C, it requires the limited scope to be both reasonable, and there has to be informed consent, which means you need to talk about the risks, the benefits, the reasonably available alternatives. So you could limit scope. And so that’s one way to limit what you’re responsible for. But another way is you can keep the scope broader, but you can limit what the flat fee covers. So when I review a lot of engagement agreements, what I often see with some really great lawyers is a conflation of scope and what’s covered under a flat fee, if that makes sense. Because really two separate issues. So the limited scope is what you’re professionally responsible for. The limitations on the flat fee could be something smaller than the scope. So the scopes out here bigger and then more narrow is the limitations on that flat fee. So again, I see those mixed up, and when I look at some really great engagement letters, I often will say, okay, let’s shovel this around a little bit and clarify, this is the limited scope, this is what’s covered under the flat fee. Two separate and really important things. 

Stephanie Everett: 

I think I’m with you, but do you have an example, maybe a quick one that could kind of help us see this a little bit better? 

Craig Dobson: 

So an example would be, maybe I’ll use an immigration example. So familiar with that. So you could say it’s a thousand dollars to handle this kind of immigration case, but the scope of the representation is broad. It says we will handle your naturalization case. The flat fee covers only preparing and filing your naturalization application, but then if you attend the interview with the client, which would be covered under the scope, that would be billed by the hour, for example. So you’re saying there very clearly in a concrete way, the flat fee only covers up through the preparation and submission of the application. If we attend interviews that costs our hourly rate, for example, let’s say you go down to an interview with a client and sometimes the wait is five minutes, sometimes it’s five hours. You have an unusual office that’s really challenging. So you want to bill because there’s a lot of variability on that side. You could do the portfolio example like you give, but maybe you just want to be fair with this client. The case took much longer. So you do it that way. But that’s kind of an example of how it would work. So there’s scope and then there’s, what does that flat fee cover two separate issues. 

Stephanie Everett: 

Makes sense. I like it. Alright, anything else? I feel like you were going to give another issue. 

Craig Dobson: 

What are the alternatives? So you could do, there’s a subscription model that might even work. So for example, another way you have uncertainty. So when I did my first, there’s a kind of visa that we do that’s for crime victims, but there’s a limit of 10,000 per year. So when I did my first case some years ago, I think the case was approved in two months. Now according to what I heard from a lawyer recently, the weight is 25 years. It’s really insane what kind of, who would even apply for such a visa, but imagine if you charged a flat fee for that case. Imagine if you went in, you’re a new lawyer, you didn’t know it was going to take 25 years to charge a flat fee. You’re going to be on the hook for 25 years on a case. So one way to reasonably deal with this, if you know it at the asset, would be flat fee in the beginning and then maybe kind of like a subscription or a yearly fee. So the client pays you a reasonable yearly fee to be professionally responsible. You call, they call you, they check on the status of the case, whatever, but let’s say the client stops paying you, it would give you a reason to then properly withdraw from the case. So you’re not on the hook at my age, a lot even younger than I amm, you may want to retire before 25 years. So imagine if you approach retirement age and then people are saying a partial refund, something like that. So that’s another possibility. 

Stephanie Everett: 

And then that’s fascinating. I was just thinking maybe you do want to go retire, which lawyer’s going to take that case because there’s no income coming in. You just came to me and said, okay, Stephanie, I’m ready to retire. Can you take my portfolio of 30 cases that are waiting on for some amount of time for a decision, but I got the fee 20 years ago, so there’s no fee left. Don’t want to take that case from you. So yeah, that’s a great point. 

Craig Dobson: 

Yeah, subscription. Another kind of fee that I charge, I totally agree with you that I like to charge flat fees. I started to charge more by the hour. My immigration cases I charge, as you imagine, most of the lawyer clients I charge by the hour, but people don’t like that. So I really am constantly trying to think, how can I take you very seriously? You convinced me a long time ago, I should move away from hourly billing. But it’s hard. And there’s also a minimum fee possibility, which is if you don’t reach a certain number of hours, the fee essentially acts like a flat fee. But if you exceed, then it turns into basically an hourly case. There’s a special rule on that in New York you have to watch out for. You could even charge a maximum on a case. So to say you could charge a minimum of X, a maximum of some amount, but that has its own problems. That has its own risk. It could be a case where you hit the maximum and you’re stuck with it 

Just like the client would be stuck with the minimum. So to a degree with a client, a deals the deal, you’re the drafter of the contract, you’re the lawyer, the more sophisticated party. But anyway, I guess think about these and the more you get into a more creative kind of billing, then you should probably consult with a lawyer. As much as Stephanie and I like flat fees, we still have to remember there’s still considered alternative fees. So even the flat fee is considered alternative fee. The standard kind of billing in the United States is still hourly. So if you’re going outside that it is probably a good idea to consult with somebody about what the options are. 

Stephanie Everett: 

And maybe that’s a good place. As we wrap up, it’s a great reminder that the good news is there are lawyers like you and I know several in different states who are willing to think outside the box, who are kind of helping our profession move in this direction. I feel like years ago when I first started doing this work, you go to a lawyer that specialized in ethics and professional responsibility and they would just say, no, you need to stay in the box. You got to do it the way we’ve always done it. There’s no other options. And now it’s so nice that you can go and get this help and really help the people are out there, like youth helping lawyers think and push the envelope a little bit into how do we set this up and still protect ourself, still have all the right language and our engagement letters, but really help our businesses and our clients. So it’s a good reminder to, as lawyers, what do we say? We often don’t go get counsel, but we should. 

Craig Dobson: 

Yeah, yeah. That’s right. 

Stephanie Everett: 

Yeah. So Craig, we’ll try to link to that article if we can that you mentioned in the show notes. I think that could be helpful for people who want to dig in and read a little bit more. But I just really appreciate this conversation. I know you’ve gotten people thinking, which is what we like to do, think about and make sure you’re not just jumping to a conclusion, but really thinking through your fees and how you’re setting up your business. It matters. So always great to talk to you. 

Craig Dobson: 

Great to talk to you. Thank you for having me.