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It's better with a letter

It's better with a letter

So, you want your bills boosted by "value"? Garry Barnsley says the first step is to sit down and write a letter He came into my office and sat down. "I've got a big problem," he said,

So, you want your bills boosted by "value"? Garry Barnsley says the first step is to sit down and write a letter

He came into my office and sat down. "I've got a big problem," he said, "and I don't know if I can keep my composure while I tell you about it."

The telling of his story took a while. I had a few questions. Then, I gave him five options (including the "do nothing" option) and told him what I would do in his place. I ended our meeting with this remark:

"You know, you might have figured this out for yourself. Except that I've got something that you don't have - and it isn't my legal expertise."

"What's that?" he asked.

"I'm detached," I replied. "But you, you're down in the emotional swamp, up to your neck in crocodiles. Me, I'm sitting safely on the riverbank. I can tell you the best way out of the swamp.

"And just so everything is clear for you, I'm going to write you a letter - a lawyer's letter. I'll go over your choices again and confirm my advice."

We spoke about what my letter would cover, and why it was important for him to get written advice (not least because we both knew that the first thing his wife was bound to ask him was: "What did he say?")

He left my office after our 45 minutes together, wearing crocodile-leather shoes and a big smile. And he was standing 15 centimetres taller (you get that when the weight of the world is lifted off your back).

It was a satisfying moment for me, because that's the best thing about being a lawyer - helping people solve problems. We enjoy warming to our client as a fellow human needing our help, but we're calmly dispassionate as the analysing begins and the advice emerges. We all know that if we can be unemotional, and suppress our fears and prejudices, we'll be clearer in our thinking, and we can make the right choice from the alternatives. It's all part of being professional, isn't it?

What is a fair fee?

The money at stake was $50,000; my time on the job face-to-face was less than one hour. If I was a doctor, the schedule fee would be about $70 for the consultation, with no uplift for success - such as for diagnosing a life-threatening condition and providing an immediate cure. The fee schedule doesn't allow for value pricing.

As a lawyer, just applying a "normal" rate to my shining hour of sheer brilliance gives me a modest reward. It's better than what a medico earns and it's much better than charging a token fee - or nothing at all.

I confess that that's what I used to do.

I once thought that giving away one-off advice free of charge was "goodwill building" - a curious form of "loss leader" endemic in the business of lawyering ("First Consultation Free").

I figured that if I made deposits in the favour bank, I'd be rewarded with a juicy conveyance or a stream of referrals. I was so often disappointed. The favour bank, like so many others, went bust.

Meanwhile, the handful of bread-and-butter jobs we do are famine-stricken. Just look through the Yellow Pages. There we are expensively trained lawyers competing for a diminishing slice of a mouldy loaf:

Conveyancing: decimated by competition from licensed conveyancers and price discounting.

Personal injury claims: shrivelled by law reforms that were partly driven by anti-lawyer rhetoric.

Litigation: burdened with process and affordable only by the very rich, or the very poor.

Wills: still thought of as "simple" (and therefore "cheap") in times so perverse that even the simplest will can't directly speak for any part of the trillion dollars of the nation's savings held in superannuation. And we mustn't forget that the Public Trustee promises the public a "free" will.

Every traditional category of legal work is under pressure of some kind - from regulators, from competitors, or from our perception of what the market is prepared to pay.

But we do have a line of business that's rarely listed among the advertisers' strong suits. It's what we do best and gain most satisfaction from.

We give advice; really good advice

Fairness, reasonableness and wisdom are qualities that lawyers are expected to canvass in their advice (see for example, Riz v Perpetual Trustee [2007] NSWSC 1153: Brereton J).

To do that well takes training, awareness and experience.

But how often do we ask a really good fee for this advice - a fee that mirrors the value to the client?

Ironically, the popular contest between "hourly billing" versus "value billing" proceeds on the assumption that a lawyer's bill based on value merits a lower fee than one based on hours worked (or, more cynically, hours recorded). Fashionable outrage thunders against "unethical" time billing that is said to encourage inefficiency and overcharging.

The struggle for ascendancy is inconclusive. Value billing sounds cosy but is largely guesswork, and value is vaguely described in waffle words; time is needed to provide any service.

My practical answer is to reflect on an old saying (which I've just made up): "Value is in the eye of the beholder." My work really starts when the client walks out the door; up until then it's all been fun.

As soon as the door hits the jamb, I sit right down and write a letter (I've had to discipline myself to seize the moment). My letter might take me anywhere from ten minutes to an hour to compose, and it probably won't say much more than I said within my client's hearing.

But my letter-writing delivers real value: value for my client and value for me.

It demonstrates to my client that I listened caringly to his worries, and that I have the confidence to commit my best possible advice to written form.

My letter summarises in a logical way my analysis of his problem and gives him a permanent record to refer to.

It protects me against claims based on misunderstandings. I can limit my retainer and qualify the scope of my liability.

It turns something that's intangible (legal advice) into something that's tangible (a lawyer's letter of advice). It gives my client something against which to assess the fairness of the fee I charge him.

It also speaks to me about the scope of the knowledge and skill I possess and the responsibility and liability I am undertaking. It gives me courage to charge accordingly.

I never begrudge the time I invest in letter-writing. Even if I haven't used a template to help write the letter (I have lots of them) I know that my new letter can become a template. And, as surely as the sun rises in the morning, I know I'll use that template again and again - to the benefit of my future clients who present with a similar problem, and to my benefit too .

I sent my four-page letter of advice to my client, along with my bill for $660. He paid it gladly at 10.35am the day after he got it. I had a good feeling that day, right up until I collected my car from the garage - and winced at a bill for $1000 for the grease and oil change and minor repairs.

But I feel safer on the road now, and that's a valuable feeling. Good value is what I really paid for. And really good value is what my client got, as he made the shift from crocodile bait to crocodile wrangler.

Garry Barnsley is a solicitor based in Bowral, NSW

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