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July 07, 2008

How You Can Make Money By Turning Cases Down

David Swanner of the South Carolina Trial Lawyer Blog writes a very important post called, "How You Can Make Money By Turning Cases Down."  There are multiple reasons this post is important and they go beyond what David has written:

..if I take their case, do an investigation, get the accident report, the insurance information, the medical records and do a full and complete workup and the case, really , really isn't worth much and I work my butt off to get nuisance value out of it, am I really helping the client?  I don't think so.  If I know the case is a loser, I don't think that I'm doing the client a favor by getting his hopes up and using a lot of resources in documenting and working up a case that can't be won.

Now realize I’m not talking small cases that have value, but not a significant dollar amount. I’m talking a case, where there is no causative link between the injuries and the incident with significant intervening factors.

By not taking the case in the first place, I didn’t give the client false hopes. I also saved my office the time and effort of running around and documenting a losing case. That time can be better spent working on our good cases.

One can argue that a lawyer should not take a non-meritorious case to begin with but that's not what David is emphasizing.  He's saying if your gut and experience as a counselor at law tells you there is nothing there, don't squander your resources as this costs you money and time which can better be used on cases with merit (regardless the size) which will generate income.  In addition, it is more harmful to the client if you do take the case by giving false hope (And if you are thinking, "it's a client..I need a client" you're time will still be better spent marketing, networking and building your web-presence.)

But there is another point.  Over time you will recognize how much it costs you in time and resources to represent a client (as well as NOT HAVE TIME for cases which generate more income).  There will come a point where even if a case has merit, it is not the right case for you as it will be a negative income-generator.  This means no matter how you slice it, your investment will be greater than the return.  How can that be if you get your fees plus expenses?  Because you can't replicate time and your time may be better spent on greater incoming-producing cases.

And that's where new solos who have lower overhead and are trying to establish themselves  step in .  You want to catch these cases.  There was a time I did a lot of referral work.  Clients knew to come to me because I would match them up with the right lawyer.  Right lawyer didn't mean my friends.  'Right lawyer' meant the lawyer who was the proper all around fit for the client's case.  If there is a client who's legitimate case is worth $20,000 and you shop them to a firm whose cases are routinely $1million and up, this would not necessarily be a good fit.  Yet this client may have a great case for a solo/small firm building a track record providing you believe the solo/small firm will take good care of the client.  The client is trusting you to refer them to the 'right lawyer' if you decide to decline the case.

Do you routinely feel you have to take every client who wants to hire you even if it will ultimately cost you money?

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