Monday, November 23, 2015

Why Do Most People Hate Paying Legal Fees?

It happens on a weekly, sometimes daily basis. I receive a question from a blog reader and the question is not general in nature; in fact, the question seeks legal advice (often on a fairly significant matter that involves potential liability) which can only be provided after thoroughly reviewing the reader's governing documents and rendering a legal opinion. My standard response is usually: "Do you have an attorney for your association?"

Ninety percent of the time, the blog reader responds that the association does have legal counsel and then offers a reason why the association's counsel was not contacted with the question. The reasons run the gamut from the lawyer being inept to the reader thinking the question was not important enough to contact the attorney.

I understand, however, that the real reason is often that most people hate paying legal fees and if they can get a free first or second opinion from a blog, other social media source or even just a retired out of state lawyer at a cocktail party, all the better in some minds. These efforts to avoid paying legal fees cross many practice areas.  For example, I am amazed at how often people will sign contracts without counsel's review and with apparent disregard for crucial items like warranties, indemnification, adequate insurance coverage, dispute resolution and venue and more.  On the other hand, people facing criminal charges are far more likely to pursue and pay for quality legal assistance in order to avoid going to jail.

Unfortunately, community association directors often believe they can squeak by with advice from whatever source is cheapest or, even better, free. Some boards will go so far as to pressure their association manager to provide such advice under the belief that the service falls within the scope of their management fee. In terms of lessons being learned the hard way, many who seek discounted or free legal advice get what they pay for and overlook the fact that when things go awry (as they often do when human behavior is involved) that they will eventually need experienced legal counsel. Such representation will be more costly and more complicated as a result of the delay, especially if litigation results. 

What if instead of avoiding legal fees like they were the plague, board members and managers simply became more sophisticated consumers of legal services? When deciding whether or not to seek proper legal advice on a matter, that decision must include an acknowledgement of what costs might ensue should things go wrong. Moreover, legal expertise, successful track record and a communication style which facilitates trust, understanding and dispute resolution are all more important factors than hourly rate when choosing an attorney.

Abraham Lincoln is quoted as saying, "A lawyer’s time and advice are his stock in trade." As lawyers, we are selling our expertise to consumers who hopefully understand the difference between what is free and what is in their best interests.

3 comments:

  1. I have seen this fairly often. Boards sometimes just do not realize that they are in over their heads and need expertise, or are just frankly cheap. And many do not seem to realize that if expertise is needed and they fail to get it they could be opening themselves up to personal liability if things go south.

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  2. Boards need to hire attorneys that don't secretly represent the management companies...they need to hold the manager accountable.

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  3. Unfortunately, unless people are very vigilant about understanding the terms of their insurance policies, the shocks often start after a dramatic event, when the policy holder makes a claim. The first shock is being informed by the insurance company that the policy does not cover their particular loss situation. The second shock is personal when those insured realise they must cover the loss themselves. Edson Legal

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