There is no direct correlation to quality and rate in general for attorneys. Many wonder why our office charges less and the reality is that we simply keep costs down and work on volume. While most attorneys are very selective in clientele to avoid collection cases, we require a payment plan to keep bills low. This assures us that we can continue working on a case and that the client does become overwhelmed by legal costs.
The reality is that there is not the demand for attorneys with the glut of law graduates every year and the availability of student loans. In 1972 there were 20.5 million California residents for about 40,000 California attorneys which is about 1 to 512 ratio. California now has approximately 37.7 million residents and about 250,000+ attorneys which is a ration of 1 to 150.8. That means that before there was only one attorney available per 512 people but not one for every 150. Attorneys increased by more than 349% per capita. Every year law schools across the country turns out more and more attorneys. I believe they are graduating more than 20,000 a year while probably no more than maybe 3,000 that retire or die. Many lawyers can and do keep working until they die in their 90s.
There are actually articles about how many law graduates cannot find work.http://www.abajournal.com/magazine/article/the_law_school_bubble_how_long_will_it_last_if_law_grads_cant_pay_bills/ http://www.charlotteobserver.com/2012/04/21/3189776/nc-law-school-graduates-face-tough.html The reality is that with the amount of graduates turned out and the economy, the market demands much less. Unless you make more than $150,000 a year, with the cost of living in California, you cannot afford $300 an hour attorney. These days with so many declaring bankruptcy, who can afford to take that chance with a client.
Also most firms do not pay their associates more than $30-$50 an hour anyways for small firms (not big law firms, associates make much more), so the only person making money is the partner. So someone charging $75 an hour can still live as if they were an associate. The downside of doing it this way is all the expenses and time that come with running a business are picked up by the partners. So considering the economic realities and the solution is to reduce costs and keep client balances minimal.
There is still a demand for big law firms that bill out $500+ an hour representing Fortune 500 companies. They obviously employe Ivy league graduates and hire the top 10%. Unfortunately not all of us can go to an Ivy league school and be top 10% of our class. It does not mean we are not as capable just not credentialed to bring the prestige of a golden resume to our practice, when it all comes down to it, the judge is still going to decide the issues on the law and facts, not our law school or class rank.
We will never be the big law firm and honestly, we are fine with representing actual people instead of major corporations. Although there are different challenges, it is very fulfilling to know we are making a difference. Even representing smaller business is more fun than simply getting directives from corporate counsel. Having a cheap/cheaper attorney does not mean, the representation is less competent, just more affordable. Obviously some attorneys are in more demand and charge more but this is not generally the case.
Generally unless an attorney has established themselves, they are arbitrarily choosing a rate. Many pick a $200-$350 rate because everyone else has the same rate. It does not mean their skills are worth it but they seem to think having a law license means they can charge that much. Many attorneys simply make up a rate and most clients knowing other attorneys charge that amount think it is a fair and pay it.
I will never forget one of the first cases I was involved in when we opened this office, the opposing attorney was freshly licensed from an UNACCREDITED ABA law school. This means they could only take the California Bar and would not be eligible to practice anywhere else except the military. These schools GENERALLY have non-qualifying student applicants (LSAT scores too low for ABA schools). They are not ranked by the ABA (not top tier, third or fourth) because the ABA does not recognize them.
The person had their license barely six months longer than I did but had never done a trial and from the pleadings apparently never took a legal writing class. The attorney did not even know how to file a motion and when she did it, it was completely violated every court rule of pleading and every standard/rule of legal writing. Another attorney that had practiced for over 40 years said, it was the worst attorney he had ever seen (he also said he felt embarrassed for her) She did not understand the law at all and appeared as if she had no experience in court (from doing clinics or internships). What was worse was she was representing an attorney from a top tier law school that was not practicing (the client did not even realize how bad the attorney was in that case). Fortunately for the opposing attorney, the case was not a good one, and nothing could have saved it (otherwise it was a good malpractice case against the attorney).
I about died when I found out she was charging $200 an hour. How could this attorney believe her services were worth $200 with her background? She had no legal experience much less trial experience. She clearly had no formal legal training apart from school, her pleadings would have failed most law schools, and the only reason she was practicing was she passed the bar. How could she charge $200 an hour when she showed no legal ability at all?
My whole point is rate is no indication of quality. Maybe one day we can become more selective with our cases and raise our rates. As of right now, we are happy providing the service at this rate. This may be the case with us in the future but considering how law schools are turning out graduates, the demand will probably not increase anytime soon. There really are no jobs available for firms that bill out their PARALEGALS at $150 an hour. Even the big firms have made massive layoffs as stated in many articles.http://abovethelaw.com/2012/01/more-evidence-that-the-legal-job-market-is-in-terrible-shape/
We would rather be making $300 an hour, but until either the demand increases or the economy improves we rather get something instead of nothing. So my whole point is never in the history of the country have the market factors effecting legal rates been at the advantage of the client as they are now. So take advantage of low rates and be represented by very qualified counsel.
About the author
‘Isi Mataele is an attorney with Mataele Law Offices. He has experience in all Southern California Courts including Los Angeles, San Diego, Orange County, Riverside, and San Bernardino both state and federal. He also has experience with various Appellate Courts as well.