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Scott Benton: Hey, everyone, it’s Scott Benton here. I am the host of the Classroom 2 Courtroom podcast. How are you? We are dedicated to providing valuable information to law students, people who just passed the bar and are looking for their first job as an attorney. We are providing information on transitioning easily from a law student to a law professional.
And on top of that, we’re making sure that the practice is fun with the tools that we are providing for you so that you can step into your first job and not have to learn a bunch of stuff that the firm doesn’t want to teach you because they expect you to show up already knowing how to practice as an attorney, a subject that law schools don’t necessarily teach you and really aren’t in the business of teaching. A subject that law schools really aren’t in the business of teaching you.
They are in the business of getting you through law school. And that’s why this podcast was put together.
Scott Benton: [00:01:00] Today’s question that we’re going to look at is, why do clients stop paying? Why do they stop paying? I mean, they’ve hired you as an attorney to work on their case and as time goes on, sometimes what takes place is that clients disengage their payments.
They just sort of disappear. They stop replenishing their trust accounts and that means their case is unfunded which means you don’t want to move forward with it because the client has simply stopped paying. Now, you want to understand that you as an attorney are selling your time, you’re selling your expertise, you’re selling your legal services, and you do that through clients paying you for those legal services.
So if they stop paying, then that becomes very problematic. And you want to be able to recognize what is happening when a client stops paying. Now, as you know, a law firm, whether it’s your own shingle, or it’s a law firm that you’ve joined that somebody else owns. A law firm is in the business ultimately of generating a [00:02:00] profit.
I mean, that’s just what it comes down to. So if you have clients that aren’t paying any longer, you’re defeating the purpose of your own law firm or the law firm of somebody else of generating a profit. I mean, they have to earn enough money to pay for overhead, which includes salaries. They need to pay for all the expenses, of course, that a law firm will incur, including rent and supplies and you know, all kinds of stuff.
You’d be surprised at how much expense is involved in running a law firm. And on top of that, they want to generate a profit and as much profit as they possibly can. That’s the entire purpose of business. The entire purpose of business is to generate a profit. So if your clients aren’t paying, if they just stop, then there’s a problem that you need to look at.
You need to recognize what those signs are. A lot of times as a new attorney, unless you have a lot of experience, maybe during law school, if you work for a law firm or something and you’ve really been able to see this clearly, you’re just [00:03:00] not going to really understand why a client would suddenly stop paying.
The excuse is always going to be that they don’t have money, but a lot of times they’re walking away, for instance, from an end result that could net them out, let’s say, 250, 000. Now, the money that they’re going to pay you as an attorney or a law firm to represent them and to help them, really kind of process their case all the way to victory is going to be a fraction of what they stand to gain once they’ve won that case, especially if they have a very good chance of winning.
There’s no reason for them to Stop paying. So if they stop paying, something is very wrong. And we want to take a look at that and make sure that you have the correct tools in your toolbox so that not only you can you prevent that from happening and make sure that your clients are continuing to pay, but also that if they have disengaged their payments and they haven’t replenish their [00:04:00] trust accounts that you have a way to get them back on track.
And so we’re going to kind of look at that for a moment. So, but let’s drill down to the core. Let’s say that a client has a case and they’ve gone to other attorneys. And even if the other attorneys at other firms have looked at this case and they’ve determined that this is a dog that this case really isn’t a good case for them to work on.
And they’ve even convinced the client that they think it’s a dog, but the client still believed in it. And they found your firm and they found you and they’ve hired you because they saw that you recognized that there was something in this case that was valuable to them. So they hired you, you started to work on this case.
And then suddenly after a while, they’ve kind of disengaged. Okay, so that should be the red flag moment for you. That should be the time where you recognize that something is wrong. And now here is the key. The key is that the case lacks clarity. [00:05:00] Now, a lot of times clients are not going to be really good at articulating what the case is all about.
They don’t know the why behind the case sometimes. But they’ve hired you because you have an expertise in this area and you are an attorney that can represent them and they see in you that you’ve recognized something in their case that will help them to articulate what this case is all about.
And so they hire you, you begin working on it, but then they go away and so at that moment you need to realize there is a lack of clarity. You have failed to provide clarity to their case, and that’s why they’ve stopped paying you. They’ve stopped paying you for a couple of reasons. They’ve lost sight of the end result of the case, and now they’re just looking at the money that they have in the bank account that’s dwindling, and they’re not looking at the end result that they could end up with, for instance, 250, 000.[00:06:00]
They’ve also lost confidence in you as an attorney because you have failed to provide that clarity to them. And when you’ve failed to provide that clarity to them, then there’s really sort of a lack of confidence, that you are no longer transferring to that client. You’re no longer transferring your confidence in winning the case to them.
And so they sort of stop believing that they’re ever going to see that 250, 000. But really what you’ve done is you just have a kind of lack of clarity. If the client has a lack of clarity, then chances are in the beginning anyway, that you have a lack of clarity. So it’s your job to sit down and a lot of times you’ve got to look in the at all of the puzzle pieces that are there because the picture isn’t going to become so clear right away, but if you sit down and you do the research and you look at all the pieces and you try to figure out how they fit together after a while, you will start to [00:07:00] clarify what this case is about and the minute that you have that clarity is the minute that you’re going to have that confidence and the minute you have that confidence is the minute that you want to call that client back up and you want to essentially tell them the story of that case.
You want to point out that you have greater clarity and an understanding of what their case is. You recognize the steps that you need to take in order to win the case. And ultimately in this example, when the $250,000 for them, which is going to more than pay for the legal services that they’re paying you and the firm for the legal services are going to represent a very small fraction of the overall gain that they’re going to realize.
And so you want to make sure that all of that is crystal clear and then it’s crystallized in a story of the case that you are going to explain to your client. Here is the story of your case. Here is what I’ve done. I’ve taken all [00:08:00] these puzzle pieces and I’ve, fit them together in different configurations.
And here is what I realized. This case is truly about and you’re going to present that to them and they’re going to feel your confidence in their case because they’re going to see like you do the clarity that you’ve been able to generate in terms of taking a deep dive look at this particular case and doing the research that’s necessary so that when you go back to the client and you’ve transferred that confidence in the case to that client. They are going to re engage their payments, or if they’ve continued to pay anyway, they will pay all the way through the end of the case.
Because that’s how strongly they believe in you, and that’s how strongly you believe in yourself and the case and your ability to win that judgment for your client. So really, when a client has stopped paying for your legal services, the problem is a clarity problem and that’s what you need to begin to look at.
You need to clarify what the case is about. You need to go back to that client, and you need to present [00:09:00] that finding to them. And really tell the story of your case to that client, so that it becomes as clear in their mind as it is in yours. And so I hope that’s helpful. I hope that’s helpful information for you.
That’s going to help you keep your cases on track. It’s going to help you keep your clients from just sort of disappearing. It’s going to continue to generate revenue for your firm, whether it’s yours or someone else’s. And it’s going to ultimately generate the profit, which all business is interested in generating.
That is their first and foremost primary responsibility, is to generate a profit. If this is helpful information and you’re enjoying what you’re hearing on the Classroom 2 Courtroom podcast, and you’d like to receive an alert every time we put out a new episode, you can always go to our website. Our website is Classroom2Courtroom. com.
That’s classroom, the number two, and courtroom. com. You can put in your contact information. and you’ll receive an alert every time we put out a new podcast episode. And if you do like this [00:10:00] information, don’t forget to share, like, and subscribe. We look forward to seeing you on our next episode of the Classroom 2 Courtroom podcast.
And until then, we hope you’ll join us in making the world a better place one client at a time. Thank you so much and take care.
