Clients may claim that an attorney’s legal bills are too high. The attorney may claim the fee is reasonable. When the client and lawyer dispute the legal bill, both of them can submit their dispute to a fee arbitration program. This program uses a fee arbitration procedure to resolve disputes. The arbitration is conducted by a third party who is neutral. This person will consider evidence from both client and attorney, and, after examining the evidence, will determine what the fee should be.
Most states offer some form of a fee arbitration program. In some states, participation is voluntary. In other states, such as New York, New Jersey, and California, fee disputes must be submitted to arbitration.
Each state’s arbitration procedure, whether mandatory or voluntary, consists of similar stepss.
- Does Written Notice Need to be Provided to the Client?
- What is Needed to File the Request to Arbitrate?
- How are Arbitrators Selected?
- What are Some Details Regarding the Hearing?
- How are Disputes Resolved?
- What Happens if the Lawyer Refuses to Submit to Arbitration?
- Do I Need a Lawyer to Help Me with Fee Arbitration?
If the attorney and client cannot agree as to the fee, the attorney forwards a written notice to the client, informing the client of the right to arbitration. Many, but not all states that have an arbitration procedure, require that attorneys who agree to arbitrate, provide this notice. The notice typically includes the following content:
- A statement of the client’s right to arbitrate;
- A statement that the client has a specific time frame in which to file an arbitration claim;
- An explanation of how to commence a fee arbitration; and
- A copy of the form the client must fill out to start the arbitration. This form is typically referred to as a “request for arbitration” form.
If the client wants to go forward with arbitration, the client must file a request for arbitration to the arbitration body having jurisdiction over the dispute. A copy of the request must be provided to the attorney.
Many states require that the client submit evidence along with the request. This documentation may consist of:
- A copy of the fee agreement between the client and the attorney;
- Copies of all legal bills sent by the attorney to the client;
- Copies of receipts and cancelled checks; and
- Copies of papers and letters about the dispute.
Some state arbitration procedures permit an attorney to respond to the arbitration request. A response may include an attorney statement as to where the parties agree and disagree. The response may also consist of a lawyer’s statement explaining why the lawyer believes the fee is proper. Any response the attorney makes must be provided to the client.
The client also must submit any required arbitration fees during this step.
Once the lawyer and the client have filed their submissions, the submissions are reviewed by the body in charge of the arbitration. The arbitrator is then selected. The lawyer and the client are given the name of the arbitrator(s), so that they can request removal if they believe the arbitrator is biased.
Once the arbitrator is designated, the arbitrator schedules the time and place of the hearing. Depending upon the type and amount of the dispute, the hearing may take place before a panel of arbitrators. A panel typically consists of three arbitrators. Typically, each party is allowed to be represented by their own attorney.
The arbitrator conducts the hearing at the scheduled time and place. Both the lawyer and client may participate by offering testimony and documentary evidence. If one side does not attend the hearing, the arbitrator typically allows the other side to present their case. The arbitrator, in such cases, typically makes a decision based on all of the evidence available to them.
When the hearing is over, the arbitrator reviews the evidence. How promptly a decision is issued depends upon the amount of evidence and the complexity of the dispute. Most states provide that a written decision must be issued within a certain time frame from the end of the hearing (e.g., thirty days).
The written decision issued to the parties specifies the basis for the ruling. Generally, the written decision is final and binding, and there are only limited rights of appeal. Appeals may generally be made by filing a suit in the appropriate court, within the time frame outlined in the decision.
In states that have an arbitration program, but do not make the attorney’s participation mandatory, the client must typically resort to filing a lawsuit. This is because states that do not mandate attorney participation typically do not penalize a lawyer for failing to participate. In addition, these states do not allow a client to receive an arbitration award unless both parties participated in the arbitration from the outset.
If you want to recover what you think are excessive legal fees through arbitration, you should consult an products and services attorney. An experienced products and services attorney can advise you as to your rights; help you prepare for the hearing; and represent you at the hearing.