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MSBA seminar to address collecting from clients

Attorneys should not be shy about following up with clients who are a month late paying their bills, said Silver Spring lawyer Mary Ellen Flynn, who helps professionals and retailers collect their debts.

“We all want to do pro bono work,” said Flynn, of Andalman & Flynn PC. “Pro bono work shouldn’t be forced upon us.”

Flynn will conduct a seminar Friday on steps attorneys should take to ensure payment from clients. She will dispense the advice at the Maryland State Bar Association’s annual meeting in Ocean City.

The session will focus on the need for attorneys to have retainer agreements with their clients delineating the scope of the legal representation and the terms of payment. These terms should state clearly whether a flat fee will be charged or if charges will be calculated on an hourly or contingency basis, in which the lawyer collects a percentage of the settlement or judgment.

In these agreements, lawyers should make clear to their clients that “you do expect to be paid and when,” Flynn said.

But attorneys should be willing to ask for payment up front if they have legitimate concerns about the client’s ability or willingness to pay. These situations include a client who files for bankruptcy or who has many unpaid bills, she added.

In such situations, the lawyer could also ask the client if a family member or friend would be willing to guarantee payment. The guarantor, in such a case, must sign a retainer agreement, Flynn said.

In any event, attorneys should not wait until the end of their representation to submit a bill to their clients.

“At a minimum, bills should go out monthly,” she said. “The world is accustomed to getting monthly bills.”

Flynn’s talk — “Show Me the Money: Tips for Preventing Problems and Getting Paid” — will be aimed at solo practitioners and attorneys in small firms, those who cannot afford administrative staff and must handle their own billing. Her biggest tip to them will be to invest in computerized billing software to save them time, ensure accuracy and make sure the invoices are sent out on time.

“No one can afford not to have a computerized billing system,” said Flynn, who served as Montgomery County Bar Association president from 2007 to 2008.

“We are under such scrutiny with regard to our [client] trust accounts,” she added. “Better to have a software program that does that for you.”

But what if a lawyer encounters a client who simply does not pay the bill? Attorneys are trained to serve their clients, so the “big question” becomes when to take the extraordinary step of suing a client to receive payment, Flynn said.

“It should be a very deliberate decision,” she added.

Flynn provided a three-part test to make the answer to that question a little easier.

A lawsuit may be filed “when you got a good result [for the client], when you worked hard for the client and you know the client has the means to pay you,” she said.

At no point, however, should a lawsuit be filed without consulting or retaining a law firm, such as hers, that specializes in collecting debts for attorneys, Flynn said.

“You want an objective, second opinion” before filing suit, she added.

Often, a recalcitrant client will pay the bill after receiving a request for payment from an outside law firm, Flynn said.

The client might be more willing to discuss a payment plan with a firm other than the one who handled his case. In addition, the fact a law firm hired another to handle the collection might show the client his or her lawyer is serious about wanting to get paid, Flynn said.

“Lawyers deserve to be paid a reasonable amount,” she added. “They deserve to be paid for the work they do.”