Lawyers and their egregious charges

CBC’s Marketplace recently featured a special – trying to find the most shocking fees charged by lawyers in Canada.

 

The banks and airlines featured prevalently in the discussion, but so did lawyers. People seemed to be incensed by the nickel-and-diming billing practices and when it came to voting for the 5 most egregious fees, one particular lawyer was included.

One of the most ridiculous submissions takes nickel-and-diming to a new level. One man complained of being charged precise amounts for every office supply his lawyer used.

“[I was] charged separately for staples ($0.07 each) and paperclips ($0.12 each) on my legal bill for doing up a will.”

It’s important to read this carefully. The lawyer wasn’t charging for the staples and paperclips in the Will, no, they were charging for the staples and paperclips used on the bill that was prepared for creating the Will !!

This opened the floodgates in the comments section of the article. The pettiness of the extras charged by lawyers struck a chord, but there was also concern about the standard charges;

You mean paper clips and staples are not included in the 300 dollar an hour legal fees?

Can you give me the name of your lawyer? Mine was $600 and they STILL charged for extras!

Many comments started to come in centred around whether the hourly fees of lawyers were actually more outrageous than the extras

The $0.07 for staples and $0.12 for paper clips is there so you think the $500 per hour is reasonable.

And when it wasn’t hourly rates, it was the sheer size of the bills

When I was an executor of an estate, there was a claim from a distant relative. My lawyer charged me $1100 to do research at the library on the topic of family and estate law!
Thought I hired him because that’s what knew about!

The examples continued to flow, and it seemed that people felt disempowered when they saw the bills coming in. Like this person who refused to pay an unwarranted charge, but the lawyer added a new line item of the same value to cover the cost of removing the spurious charge.

My lawyer prepared some documents and sent me the bill. I disagreed with a disbursement charge because I had taken care of that my self. Lawyer agreed to deduct it. I then called the law office two weeks later because I had not received the new bill. I was told they had forgot to mail it and it was on the way. Two weeks later still no revised bill. I called the law firm and once again they apologised and said they would correct this. One week later I did get the bill deducting $80.00 for the unnecessary disbursement charge and $80.00 added in under a line titled “charge for 2 invoice inquiries and related disbursements” or something like that. Called the law firm and they said their practice was to charge for time and service on bill inquiries as they were allowed to do so as a disbursement under the fee billing schedule of the provincial law society. Got a new lawyer after that.

It seems that the very act of asking lawyers for clarification over a bill resulted in additional billing to cover the cost of having the discussion about the bill !!

I was charged $80 by my lawyer once after I called him to tell that he was not to call me any more because he charged me $40 every time he called for some small thing…the $80 was my 1 minute call leaving a message to that effect and the other $40 was his call back leaving a message to say he got the message.

After reading through this list of examples showing lawyers gouging clients, comments started to flow displaying a common sentiment

This story about staples and paper clips says it all, and my opinion of lawyers just dropped another notch! I didn’t think it could get any lower than it was, but it did!

Does anyone wonder why lawyers have a bad rep?

Everyone knows lawyers gouge you whatever way they can so that’s old, old news

We deal every day with customers coming to us after having spoken to lawyers. They need one of two things; a new Will, or an update to an existing Will. Although they are often told that “you get what you pay for” this doesn’t seem to align with their experience.

The cost of a Will

How much should it cost to prepare a Will? Clearly there is a range in complexity to a Will, but many people need a Will in place when their family situation is very straightforward. They would want their entire estate to go to their spouse, and if something were to happen to both of them in a common accident, they would want their estate to be divided equally between their children.

This is what our local lawyer would call a standard Will, and to create this they would have you complete a questionnaire, on your own, in the front office. This image is the exact form that our lawyer gives to prospective clients. You include your name, address and spouse’s name. Your Executor, Alternate Executor, main beneficiary, alternate main beneficiary, and guardians if your children are under the age of 18. THAT IS IT !Lawyers questionnaireFor the resulting document, our lawyer charged $500. Anything with more complexity, for example extra bequests, would cost extra.

In this situation you are not receiving any legal advice whatsoever. To create this document the lawyer (or their staff) will be putting your details into a software package not unlike the Will writing service at LegalWills.ca. They will generate a Will that is identical to one prepared at LegalWills.ca, and when I say identical, I mean word-for-word identical. This document is not worth $500.

Our most frequent customer however is the person who had their Will prepared by lawyers and now needs an update. The name of the Executor may need to be changed, or they wish to include a charitable bequest, or they need a new alternate guardian for their child. In Canada, people have been quoted $100 per change, so they come to us to create a brand new Will, only to discover that their new $35 Will looks the same as their old $500 Will, but with the option to update it whenever they need to.

Do lawyers provide value for money?

Clearly specialized legal advice should cost a premium. After all, it has taken many years of education and expertise to develop a knowledge that few possess. Drawing up complicated estate planning trusts takes a sophisticated level of legal expertise that should be paid for. But a standard Will does not fall into the same category. You can tell from the CBC Marketplace program that many of the fees coming from lawyers offices are not “getting what you pay for”.

And for our service, you can use your own staples and paperclips…no charge.

Tim Hewson

President and CEO at Canadian Legal Wills
Tim Hewson is one of the founders of LegalWills.ca.

He has over 19 years of experience helping people to write their Will and other estate planning documents. He has been interviewed by many of the major news media outlets including CTV, Global News, The Toronto Star, and other leading Canadian publications. He has also contributed to a number of financial planning books.

Throughout his career, Tim has written extensively on the subject of Will writing and estate planning.
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