How to Prevent Attorney-Client Fee Disputes

Try to avoid fee disputes with your clients through frequent communication; the use of detailed time entries on bills; advance deposits of fees; prompt and regular billing; management of accounts receivable; and the collection of advance deposits towards fees.  Fee collection matters often provoke legal malpractice claims, so the best practice tip is to avoid being in the position of having to seek legal action against a client to collect a fee if at all possible. Make sure you are familiar with the requirements that apply to a client trust account, including knowing what types of funds must be deposited into that account and when you are authorized or required to take funds out of that account. The State Bar has published a Handbook on Client Trust Accounting which is very helpful.  Violations of the rules that govern client trust accounts can subject an attorney to discipline.

If you do find yourself in a situation in which you need to take action against a client for unpaid fees, make sure that you comply with the Mandatory Fee Arbitration Act provisions of the Business & Professions Code, section 6200 et seq.  The Bar Association of San Francisco has good resources for both attorneys and clients, including the Notice of Client’s Right to Fee Arbitration that you are required to serve before you commence a fee action against a client.  Click here to learn more.