Monday, December 06, 2010

Our Addiction To The Flexible (Non) Payment Plan

"Get it up front." That's the advice from any experienced criminal defense lawyer.

But cash flow is slow, you need the case, and you're OK getting $1,500 down on a $5,000 fee, because you really need that $1,500 right now.

A month later that first of seven $500 payments doesn't come. You hope the judge will give you enough continuances to get paid, and you're looking for a way to convince the client to pay his fee. In the end, you've received $2,500, you hate your client, and most of the conversation with him is about "when" he's going to pay.

This isn't his fault, it's yours. There's no such thing as a payment plan. It's a non-payment plan. When clients don't have to pay all the money, they don't. Remember, you're representing people accused of crimes. Some of them are accused of crimes having to do with theft or fraud. Some of them haven't done so well fulfilling obligations, so why do you expect they'll fulfill their obligation to you?

But the flexible payment plan is here to stay. Criminal defense lawyers who run factory type offices are fine with them. They'll take the credit card for the $500 down, do that a few times a day, and in the end, it's enough to pay the overhead and take a little for yourself. The lack of payment of the rest is the cost of doing business. Maybe in a year you'll look at your receivables (if you even keep track) and want to (unsuccessfully) try to collect.

I listen to how criminal defense lawyers run their practices. I hear about all these things. Sure, there are the clients that pay, but more often it's about chasing the money.

There's payment plans, and payment plans. Taking half down, or even a third and accepting a few payments may work. If you have a real case and not some show-up-once-and-get-a-plea thing, it may be OK. But generally, payment plans are a recipe for getting the down payment and nothing more.

I know "your clients" can't pay all up front. You sure about that? Have you ever asked for it all up front? Is it so foreign to you that you would never even think of it?

If you have the type of practice where you spend your days "feeling bad" for your clients, I just hope you have the type of practice where not getting paid is not an issue. Maybe you don't have rent in your home office, maybe you have no assistants, and your only overhead is your cell phone.

Those of us that don't get paid the fees we quote, deserve it. We need to stop complaining about it. People will treat you how they are permitted to treat you. If you allow clients to pay over time, you are telling them you don't really need the money.

Brian Tannebaum is a criminal defense lawyer in Miami, Florida practicing in state and federal court, and the author of The Truth About Hiring A Criminal Defense Lawyer.Share/Save/Bookmarkokdork.com rules Post to Twitter