Some of you will answer: Absolutely Not! Others may think: Not a bad idea!
We’ve all been there. Non-paying clients can be incredibly frustrating, especially if you went out of your way to offer a reduced rate or special payment plan. But before you resort to punitive measures, take a moment to think it through.
First, a literal doubling of your fee may be considered excessive. Review Oregon Rule of Professional Conduct 1.5.
Second, consider whether the proposed punitive action will make a difference. Do you truly believe that doubling your fee will motivate the client to pay?
Third, collections can be a landmine of legal traps and pitfalls.
What Should You Do If the Client Doesn’t Pay?
In the case of non-paying clients, it may be appropriate and necessary to withdraw. If so, take care to abide by your ethical responsibilities. If you represent the client before a tribunal and must file a formal Motion to Withdaw, read and understand Oregon Formal Opinion No. 2011-185 – Withdrawal from Litigation: Client Confidences. If you have any doubt about what you can or cannot tell the court, seek advice from the Oregon State Bar General Counsel’s office or contact a lawyer colleague who specializes in ethics defense.
You should also consider attending Building and Maintaining a Profitable and Efficient Law Practice on March 16, 2012. Hear Ann Guinn, a nationally known speaker, author, and consultant discuss:
The Keys to Assessing and Increasing Profitability
- Personal habits that cause you to underearn
- Identifying profitable practice areas
- Analyzing office overhead, liquidity ratios, budget, turnover rate, and realization rate
- How to establish effective billing practices
- Reducing accounts receivable
- Developing case and client selection skills to eliminate payment problems
- How to manage your time and law office effectively and develop efficient office systems
Richard Slottee, Professor of Law and Director, Lewis & Clark Legal Clinic, who will talk about the Fair Debt Collection Practices Act and other collection issues.
In addition, the Practice Management Advisors of the Professional Liability Fund will review Fee Agreements: Do’s and Don’ts.
Building and Maintaining a Profitable and Efficient Law Practice will be held at the Oregon State Bar Center. Attend live or via Webcast. Cost: $10. Register now at the PLF Web site > Upcoming Seminars.