Tuesday, March 12, 2013

"What Are You Worth?"

Stephen Gillers, Regulation of Lawyers
"What Are You Worth?"

*This, like the other answers to questions in the book, are largely based on student opinion and do not necessarily state the correct law.

One could argue that this fee arrangement would be perfectly allowable under a value-billing scheme.  While the fees charged by Darrow are clearly much higher than any other lawyer’s fees, that does not seem to be a consideration under that scheme.  In considering the value, it made sense to consider Porgby’s net worth and his ability to earn more money.  The value of Darrow’s services seemed spot on, when juxtaposed with Darrow’s earning potential.

Furthermore, Porgsby was a sophisticated buyer of legal services and the court’s paternalism does not seem fitting here. 
A court could also find that the fee contract is not unconscionable because Darrow is not taking advantage of Porgby's ignorance or exerting superior bargaining power or disguising unfair terms in small print, to borrow language from the Telex case.  Rather, Porgby knew what he was getting into and there was no asymmetry of information in the market.  Alternatively, courts could find for Porgby because limiting legal fees seems a fair tradeoff for the monopoly the bar has on practicing law.

Applying Model Rule 1.5, it is highly likely that this fee arrangement would be deemed unreasonable.  There is nothing in the fact pattern that indicates that this case would take more time and/or labor than any other murder case.  There does not seem to be any other difficult questions involved nor did there seem to be any specific skill requisite for this case.  Acceptance of this position by Darrow will not preclude her from accepting other positions because she is not looking for other positions and Darrow made this obvious to Porgsby.  Moreover, Darrow’s fee is exorbitantly high compared to the customary fees of other comparable lawyers
and her offer was a fixed fee, and not contingent (in which case she could be more justified in asking for more money because she is risking losing the case and not making a dime).   

While there is no clear “amount involved,” one could argue that Darrow enabled Porgsby to be free and allowed him to make an amount of money that dwarfed the amount that she was paid.  In addition, she was successful in her representation of him and there was likely a lot at stake.  Another factor that points in Darrow’s favor is a consideration of her experience, reputation and ability.  Furthermore, the scope of representation and basis for the fee was clearly conveyed to Porgsby.

However, this could go either way because the fact pattern did show that Darrow could be difficult to work with at times.  There do not seem to be extremely restrictive time limitations imposed by the client or circumstances and there seems to be a very limited professional relationship between Darrow and Porgsby.
Lastly, the medical analogy is not very sound.  There is a huge movement for legal billing to move to “value-billing”; however, that is not the case in medical settings.  That is because medical costs are often billed at the costs of providing the service rather than the value.  How does one value saving a life, or pulling a tooth?  While there is some crafty mathematician who could create a formula to calculate the value of certain procedures, such a formula would not properly account for the person who is receiving the procedure’s valuation of the procedure.  Also, many legal issues are brought on by some actions by the parties, whereas in many health issues, they are brought out by happenstance.​

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