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Trust Me On This

Inside Counsel By Kimberly Leach Johnson

Stop me if you’ve heard this one before.

You ask attorneys at an outside law firm to send you materials on a particular area of practice. They send you a customized document that includes a targeted description of their skills and experience, perhaps a short analysis of your legal needs as they perceive them, a group of lawyers’ bios, some suggested alternative fee arrangements, and a few paragraphs describing their commitment to superior client service. They want you to know that your concerns are their concerns. They want you to know that your complete satisfaction is their raison d’être. They want you to consider them a “trusted advisor.”

Okay, if you haven’t thought “stop” yet, you must be some kid who picked up a printout of this article while cooling your heels in your lawyer-aunt’s office.

We outside law firms mean well. We need you to know that we “get it.” We want you to know that we understand who holds the rents in our relationship with you. And the vast majority of us really, really hope you will trust us implicitly and be comfortable with that faith. (Besides, we can’t write, under the “Client Service” header, “Yadda, yadda, yadda; you know the drill,” can we?)

For what it’s worth, outside firms that sincerely mean what they put in pitch documents spend a lot of time thinking about what those promises mean. And for my money, smart firms pay particular attention to the whole “trusted advisor” issue. After all, when trust is established, all other factors tend to fall into place, so responsible outside firms ought to put a lot of thought into what makes trust real. It isn’t about legal brilliance — on a day-to-day basis, there aren’t that many ways to be “better lawyers” than anyone else, and while inconsistent and/or poor performance is a trust killer, consistent excellence is really just the price of admission for every outside firm. Trust might have something to do with understanding the client’s business so completely that the outside attorney functions much like an in-house lawyer, but that too has become a prerequisite of excellent service. Of course, providing high value for the dollar should warm every GC’s heart, but I doubt it particularly engenders trust in return.

My best guess is that trust finds its way into a relationship on a two-way street. In other words, we outside firms can’t expect our clients to trust us if we don’t begin by trusting them.

It’s not a salable commodity. We can’t realistically offer our heartfelt trust, along with the perfect firm résumé and a menu of alternative fee arrangements, and expect clients to reply, “Well, in that case . . .” Outside firms can only promise that they will work hard to earn their clients’ trust, and then follow through.

Ay, there’s the rub.

How can outside firms meaningfully demonstrate that they trust their clients? How can professional skeptics like lawyers evince genuine trust and be convincing about it?

I suggest the answer is to share our clients’ vulnerabilities. For example, the best of alternative fee structures (can we stop calling them “alternative,” by the way?) in this context are those where outside firms have some skin in the game — where they get paid more when matters turn out for the best, and less when the end result is less than optimal. The point is to give first and receive later. To help because they can, not because it’s all spelled out in an agreement. To regard meeting client needs as the true organizational goal, and collecting fees as a pleasant consequence. Management genius Peter Drucker once postulated that the purpose of a business is to create happy customers — well, I’m pretty sure that a client who trusts you is a happy client.

Here’s an example of where trust has taken my firm to the next level: We litigate for one of our longtime clients on a flat-fee basis. We can do this because we and our client simply trust one another. If any given case settles two days into discovery, there’s no way we’ll expect to be paid the entire fee, and if the matter drags out longer than anyone expected, we accept it on faith that they’ll take care of us. We both understand that we can talk about it after the dust has settled, so no one wastes time worrying about who owes whom what. It’s a great place to work: together, in an atmosphere of trust.

It’s not easy to be vulnerable, and even less so to willingly make oneself vulnerable. But clients face risk every day, so I think it’s a good idea to face it with them, if we really want them to trust us.

And embracing vulnerability definitely has its rewards. For another example, a number of years ago, we offered to help a client conclude a matter at an unusually large discount, plus a contingency fee, agreeing to comparatively very-low rates that had been previously paid to local counsel. The case then proceeded to drag on much longer than anyone foresaw, but we stuck to our deal anyway. Somewhere along the line, the client spontaneously acknowledged that they were getting, essentially, “too good a deal” and paid us a significant portion of the fees we had given up. They still got a good deal, and we got an unexpectedly good deal — but they rewarded our trust with fairness. Win-win.

This is why it may be good to be a large law firm, but it’s still better to think like a small firm. In that zone, you take chances and maybe get burned now and then, because it’s worth the risk. When you join your client on a limb, you discover the opportunity to prevent one another from falling, and if the fall is inevitable, then it’s essential to fall together if you truly want to be a “trusted advisor.”

Originally published in Inside Counsel, November 18, 2013

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