Lessons in Legal Fees: $41,000 Base + $30,000 Interest = Censure
Wyoming's highest court has publicly censured a lawyer working out of the state's capitol for charging a client $30,000 in interest fees on a bill that was originally just $41,000. So if you're considering charging your clients almost 50 percent in interest, we recommend against it. Top tip? Just don't.
One could say that Cheyenne lawyer Bruce Asay, the recipient of the court's censure, was merely covering himself, however. After all, one of his apparently office policy was to charge a rate of 1½ percent interest on all accounts receivable per month. The idea was to get those pesky clients paying -- instead, he got himself into ethical hot water.
Report by Wyoming Board of Professional Responsibility
Wyoming's Board of Professional Responsibility was first turned on to Asay when a client for whom Asay completed employment-related work finked on him for a bill that had steadily crawled higher and higher. The client had retained Asay to represent him in a denial of benefits suit, and later again in an age-discrimination suit.
It appears that Asay failed to clearly communicate to the client what his exact fee arrangements were. One agreement contingency-based. Another was for work to be paid hourly. When the client wrote a $4,000 check to Asay in 2011, he allegedly believed that the sum was to get the ball rolling on his age discrimination claim. But Asay countered that the check was placed towards past debts -- debts that were growing by $300 a month.
It's All Good
Asay's public censure will probably fade away, as could the damage to his reputation. The Board made note of Asay's good character and lack of any prior ethical breaches during his career. In the meantime, the censure a relatively bloodless way to highlight the need for attorneys to be very clear to their clients about fees and the rate of accruing interest.
By the way, $41,000 accruing at the rate of 1½ percent per month with a future value of $70-71k is about three years. That's sounds reasonable to at least a few attorneys...
- Compound Interest Charges Violate Rule 1.5 (LegalProfessionBlog)
- Trial Interrupted as Defense Attorney is Arrested for Meth, Fraud (FindLaw's Greedy Associates)
- Florida Prosecutor's Meth Arrest: Beware The Company You Keep (FindLaw's Greedy Associates)
- Attorney Accused of Forging Judges' Signatures -- 114 Times (FindLaw's Greedy Associates)
You Don’t Have To Solve This on Your Own – Get a Lawyer’s Help
Meeting with a lawyer can help you understand your options and how to best protect your rights. Visit our attorney directory to find a lawyer near you who can help.