Am I Obligated To Pay Attorney Bill?

Cosmic Pony · Post by **Cosmic Pony** » Sat Nov 23, 2019 6:25 pm

I sold some land a few months ago and was unsure as to how to establish a cost basis. The developer I sold the land to recommended his tax attorney. I called the guy, briefly (two minutes or less) outlined the documentation I had (a one page estate inventory) that I was pretty certain I could use to establish a cost basis. He told me to send him the doc., so I did. I followed up with him, (three minute call) he told me that yes this was the best cost basis tool and then informed me that I could build the cost of his fee ($150) into the cost basis. I thought he might be advising me for free since he does a lot of work the the developer I sold the land to. There was no agreement (i.e. disclosure of fee schedule, scope of work, etc.) between us up front outlining that I would be charged. I can afford to pay the fee but the whole thing struck me the wrong way as I was unclear that I was on the clock. Am I obligated to pay him?

Rob5TCP · Post by **Rob5TCP** » Sat Nov 23, 2019 6:28 pm

As one who bills on a time basis; i would expect someone to pay if I helped them with an issue. Probably 15-20% of my work is with one time clients. If I can give an answer off the top of my head, I won't bother to send a bill.
If I have to go back and fourth a couple of times, a bill will follow.

For $150, probably not worth making a deal of it.

HomeStretch · Post by **HomeStretch** » Sat Nov 23, 2019 6:29 pm

IMO, yes. Any time I call an expert like an attorney I expect to pay for the service. If I have any doubt, I ask before getting into the reason for my call. While the two calls totaled 5 minutes, the attorney also took the time to read through the document and perhaps might have done some research to answer your question. $150 seems reasonable.

WorldWanderer · Post by **WorldWanderer** » Sat Nov 23, 2019 6:32 pm

Yes, you should consider payment for the services.

Ocean77 · Post by **Ocean77** » Sat Nov 23, 2019 6:32 pm

I'd get a written invoice, plus ask him to put his opinion in writing (and send it with the same letter). Then pay it. That way, if there are later issues with the IRS contesting the cost basis etc, he'll be on the hook. That "insurance" would be worth the $150 already.

drawpoker · Post by **drawpoker** » Sat Nov 23, 2019 6:35 pm

^^this

Good advice.

Gill · Post by **Gill** » Sat Nov 23, 2019 6:38 pm

Pay the bill. Did you expect to consult a tax attorney for free? You got off cheap.
Gill

Gill · Post by **Gill** » Sat Nov 23, 2019 6:39 pm

Ocean77 wrote: ↑Sat Nov 23, 2019 6:32 pm I'd get a written invoice, plus ask him to put his opinion in writing (and send it with the same letter). Then pay it. That way, if there are later issues with the IRS contesting the cost basis etc, he'll be on the hook. That "insurance" would be worth the $150 already.

That will certainly serve to increase the fee!
Gill

tibbitts · Post by **tibbitts** » Sat Nov 23, 2019 6:44 pm

Gill wrote: ↑Sat Nov 23, 2019 6:39 pm
Ocean77 wrote: ↑Sat Nov 23, 2019 6:32 pm I'd get a written invoice, plus ask him to put his opinion in writing (and send it with the same letter). Then pay it. That way, if there are later issues with the IRS contesting the cost basis etc, he'll be on the hook. That "insurance" would be worth the $150 already.
That will certainly serve to increase the fee!
Gill

Probably, maybe at least try to get an email thread discussing the issue and conclusion. That might not leave him "on the hook", but at least it would show you had some basis for your... basis. All you have now is your recollection of a conversation.

But I'd say you've used $150 of his services and should pay.

RickBoglehead · Post by **RickBoglehead** » Sat Nov 23, 2019 6:47 pm

Based on the calls, no. But you sent him the document to review, so yes.

JoeRetire · Post by **JoeRetire** » Sat Nov 23, 2019 6:54 pm

Cosmic Pony wrote: ↑Sat Nov 23, 2019 6:25 pmI thought he might be advising me for free since he does a lot of work the the developer I sold the land to. There was no agreement (i.e. disclosure of fee schedule, scope of work, etc.) between us up front outlining that I would be charged. I can afford to pay the fee but the whole thing struck me the wrong way as I was unclear that I was on the clock. Am I obligated to pay him?

You thought you were getting free legal advice?

retire2022 · Post by **retire2022** » Sat Nov 23, 2019 6:57 pm

Op if the attorney wanted to make it hard for you he could possibly put a lien on your property and you could have a hard time selling the property in the future.

good luck

hudson · Post by **hudson** » Sat Nov 23, 2019 7:13 pm

$150...wow that's a bargain.
I think the last attorney I worked with wanted $300 for a consultation....then $7500 to get started...all upfront. The final bill was much more...worth every penny. I paid the bill the day that I got it.

nisiprius · Post by **nisiprius** » Sat Nov 23, 2019 7:16 pm

If he sent you a bill, you should pay it. I'm unclear on whether he sent you a bill, or whether he just mentioned that there would be a $150 fee.

It's too bad you didn't discuss this. I understand where you're coming from, because it's awkward. But you can't handle things like this on the basis of "wishful thinking" or what you think is the custom or anything like that.

If he hasn't sent you a bill in writing, paper or electronic, I don't think you need to pay it until you get it, but you should expect to get it.

$150 is nothing for legal work. Nothing, nothing, nothing.

Pay it, and next time remember to discuss fees up front.

What happens if you don't? Who knows? But who want to get into a legal fight with a lawyer? What are you going to do, hire another lawyer to fight this one? Imagine how enthusiastic a lawyer will be about taking on a case with a client who doesn't like to pay lawyers.

inbox788 · Post by **inbox788** » Sat Nov 23, 2019 7:23 pm

Cosmic Pony wrote: ↑Sat Nov 23, 2019 6:25 pm...he told me that yes this was the best cost basis tool and then informed me that I could build the cost of his fee ($150) into the cost basis.

Was that his not so subtle way of saying he was billing you and how much or did he actually send an itemized bill? How much does he bill and what is his minimum? It's not unusual to spend 3 actual minutes and bill for 5, 6, 10 or 15 minutes for a task. There were at least 3 interactions, so $50/per? Maybe 6 minute intervals at $500 rate?

If it's any consolation, Uncle Sam is paying a portion of that bill. How are you documenting the expense?

Stinky · Post by **Stinky** » Sat Nov 23, 2019 7:27 pm

Ocean77 wrote: ↑Sat Nov 23, 2019 6:32 pm I'd get a written invoice, plus ask him to put his opinion in writing (and send it with the same letter). Then pay it. That way, if there are later issues with the IRS contesting the cost basis etc, he'll be on the hook. That "insurance" would be worth the $150 already.

Getting a written opinion would probably make the bill $500.

Seas · Post by **Seas** » Sat Nov 23, 2019 7:32 pm

If an attorney did not enter in to a engagement or a retainer agreement he is out of luck legally I believe.

So no you need not pay, if he filed a lien you have a good case with the state bar.

Now if you want to pay him something that you feel is fair that's up to U.

Erwin007 · Post by **Erwin007** » Sat Nov 23, 2019 7:57 pm

I think you should stiff him. I mean he only spent 5-10 minutes, right?

(Just echoing the typical advice given to questions regarding physician billing).

But really, yes you should pay him.

Kenkat · Post by **Kenkat** » Sat Nov 23, 2019 8:00 pm

Pay the man.

JoeRetire · Post by **JoeRetire** » Sat Nov 23, 2019 8:22 pm

Seas wrote: ↑Sat Nov 23, 2019 7:32 pm If an attorney did not enter in to a engagement or a retainer agreement he is out of luck legally I believe.

So no you need not pay, if he filed a lien you have a good case with the state bar.

Sure, don't pay him. Tell him that some random person on the internet who you don't know believes that he is out of luck legally.

After all, what's he going to do - sue you?

WildBill · Post by **WildBill** » Sat Nov 23, 2019 8:27 pm

Howdy

You asked for advice.

You sent the document.

You got the advice.

You got a deal.

Pay the man.

W B

EddyB · Post by **EddyB** » Sat Nov 23, 2019 8:31 pm

Seas wrote: ↑Sat Nov 23, 2019 7:32 pm If an attorney did not enter in to a engagement or a retainer agreement he is out of luck legally I believe.

So no you need not pay, if he filed a lien you have a good case with the state bar.

Now if you want to pay him something that you feel is fair that's up to U.

Which state did you decide they were in?

Jeff P · Post by **Jeff P** » Sat Nov 23, 2019 8:48 pm

No. And this attorney did a lot of shady things.

1. You dont have an attorney client relationship here.
2. You probably cant because of a conflict of interest in that he represents the person you are selling it to. You could waive it, but he cant be your attorney unless you and the developer both waive the conflict
3. No written agreement, which his state bar probably requires as an ethics rule
4. No discussion of fee before hand. Hes just being sneaky.

Dont pay him. And if he gives you trouble, file a complaint with his state bar.

8foot7 · Post by **8foot7** » Sat Nov 23, 2019 8:51 pm

I generally err on not paying unexpected bills but in this case $150 for two phone conversations and a document review is
very reasonable when it comes to legal services, and you got an answer to your question which resolved the matter. So I don’t understand why you wouldn’t pay.

ARoseByAnyOtherName · Post by **ARoseByAnyOtherName** » Sat Nov 23, 2019 8:52 pm

Not paying a lawyer's bill seems.... unwise.

In the situation you described, if my only contact was talking to him on the phone for 3 minutes I wouldn't expect a bill. However, the minute I sent him a document for review offline/outside of the call itself, I would expect to be billed for it.

Pay the bill, it's a cheap lesson learned. You likely could have just described the document to him on the phone and gotten the same answer instead of sending it to him, it sounds pretty straightforward. Also, proactively ask next time before doing anything other than a simple phone call.

Sure, you could tell him to stuff it, file a complaint with his state bar, tell his mommy, "make him pay", etc. etc. etc... but honestly it's $150, who cares? Just pay it and move on with your life. Honestly you probably already spent more than $150 of your time thinking about it, posting about it, reading the replies....

Rudedog · Post by **Rudedog** » Sat Nov 23, 2019 8:55 pm

YOU called him. Pay him. That's dirt cheap for a tax attorney.

mcraepat9 · Post by **mcraepat9** » Sat Nov 23, 2019 9:04 pm

By the way, I believe you almost certainly DO have an attorney-client relationship at this stage based on your interactions alone regardless of you not having signed an engagement letter.

You think the attorney believes he can disclose your confidential info to government and others / use it against you in a future legal matter?

Fee again you can probably get away with not paying though I believe it to be unethical. He’s not going to sue you most likely. He should have been more upfront about billing and fees.

Disclosure: attorney in private practice

Raymond · Post by **Raymond** » Sat Nov 23, 2019 10:32 pm

Cosmic Pony wrote: ↑Sat Nov 23, 2019 6:25 pm ...I thought he might be advising me for free since he does a lot of work the the developer I sold the land to. There was no agreement (i.e. disclosure of fee schedule, scope of work, etc.) between us up front outlining that I would be charged. I can afford to pay the fee but the whole thing struck me the wrong way as I was unclear that I was on the clock. Am I obligated to pay him?

(emphasis added)

Sorry, but the bolded part makes zero sense to me. You needing to figure out your cost basis has nothing to do with whatever work he did for the developer, in my view.

And it's likely he spent at least a few more minutes reviewing your document, in addition to the total of five minutes you state he spoke with you. You're not just paying for his time, but also for his expertise.

Could he have stated up front he was going to charge you? Sure, he could have been clearer. But he did the work, you got your answer - pay the man.

spectec · Post by **spectec** » Sat Nov 23, 2019 10:45 pm

Maybe you should have asked about fees before occupying his time & using his advice.

You: "I have some questions. Is there a charge for your services?"
Attorney: "I answer the first question for free, then there's a charge for all remaining answers."
You: "How much is the charge?"
Attorney" "$150 per answer. What's your next question?"

willthrill81 · Post by **willthrill81** » Sat Nov 23, 2019 10:50 pm

WildBill wrote: ↑Sat Nov 23, 2019 8:27 pm Howdy

You asked for advice.

You sent the document.

You got the advice.

You got a deal.

Pay the man.

W B

CRTR · Post by **CRTR** » Sat Nov 23, 2019 11:24 pm

Gill wrote: ↑Sat Nov 23, 2019 6:39 pm
Ocean77 wrote: ↑Sat Nov 23, 2019 6:32 pm I'd get a written invoice, plus ask him to put his opinion in writing (and send it with the same letter). Then pay it. That way, if there are later issues with the IRS contesting the cost basis etc, he'll be on the hook. That "insurance" would be worth the $150 already.
That will certainly serve to increase the fee!
Gill

Nothing more than an observation. No judgement/criticism/flaming/etc etc.

It is interesting how the expectations for various professions differ.

My father was an ER physician. I can't even begin to count the number of times he was asked for medical advice, second opinions, shown labs/xrays, etc etc. He helped everyone from neighbors/friends, to his contractor, to his CPA, his tax attorney, etc. He was not reimbursed for any of it. I imagine that if he were to ask (especially after the fact, without previous agreement/discussion) for some $$, the response would not have been anywhere near as sympathetic to him as to the attorney above. Furthermore, if he were asked to produce an invoice, detailing his charges and tried to increase his charge as a result, he would've been laughed at and probably reported to the medical board. Pretty sure I can say the same thing about my neighbor, who is a CFP. Seems people are asking him for and receiving quick "freebies" all the time. . . myself included.

The legal profession is so much smarter/better off than most in this regard. I think they have it right. I feel that all professionals should be reimbursed for their time and expertise.

willthrill81 · Post by **willthrill81** » Sat Nov 23, 2019 11:48 pm

CRTR wrote: ↑Sat Nov 23, 2019 11:24 pmThe legal profession is so much smarter/better off than most in this regard. I think they have it right. I feel that all professionals should be reimbursed for their time and expertise.

I once heard a story set back when computers were the size of rooms. Someone with such a computer had a problem and called in an expert to fix it. It took the expert about 10 minutes to fix it by replacing a small, inexpensive part. He said that his bill was $25,000. The boss said that he would need an invoice for such a high amount. The invoice read "Replacing part, $5. Knowing which part to replace, $24,995."

Trader Joe · Post by **Trader Joe** » Sun Nov 24, 2019 12:05 am

Cosmic Pony wrote: ↑Sat Nov 23, 2019 6:25 pm I sold some land a few months ago and was unsure as to how to establish a cost basis. The developer I sold the land to recommended his tax attorney. I called the guy, briefly (two minutes or less) outlined the documentation I had (a one page estate inventory) that I was pretty certain I could use to establish a cost basis. He told me to send him the doc., so I did. I followed up with him, (three minute call) he told me that yes this was the best cost basis tool and then informed me that I could build the cost of his fee ($150) into the cost basis. I thought he might be advising me for free since he does a lot of work the the developer I sold the land to. There was no agreement (i.e. disclosure of fee schedule, scope of work, etc.) between us up front outlining that I would be charged. I can afford to pay the fee but the whole thing struck me the wrong way as I was unclear that I was on the clock. Am I obligated to pay him?

Yes, you should pay your bill.

Bobby206 · Post by **Bobby206** » Sun Nov 24, 2019 12:13 am

It's an implied contract. It's like walking into the barber shop, sitting down in the chair, and letting the guy your hair. You know it's not free. Yes, some attorneys do freebies on nickle and dime stuff like you describe but not all. You should most definitely pay the bill. 100%!

MrBobcat · Post by **MrBobcat** » Sun Nov 24, 2019 12:16 am

JoeRetire wrote: ↑Sat Nov 23, 2019 6:54 pm
Cosmic Pony wrote: ↑Sat Nov 23, 2019 6:25 pmI thought he might be advising me for free since he does a lot of work the the developer I sold the land to. There was no agreement (i.e. disclosure of fee schedule, scope of work, etc.) between us up front outlining that I would be charged. I can afford to pay the fee but the whole thing struck me the wrong way as I was unclear that I was on the clock. Am I obligated to pay him?
You thought you were getting free legal advice?

You'd be amazed (or maybe not) the number of people who call asking for free advice from professionals.

MrBobcat · Post by **MrBobcat** » Sun Nov 24, 2019 12:18 am

Cosmic Pony wrote: ↑Sat Nov 23, 2019 6:25 pm I sold some land a few months ago and was unsure as to how to establish a cost basis. The developer I sold the land to recommended his tax attorney. I called the guy, briefly (two minutes or less) outlined the documentation I had (a one page estate inventory) that I was pretty certain I could use to establish a cost basis. He told me to send him the doc., so I did. I followed up with him, (three minute call) he told me that yes this was the best cost basis tool and then informed me that I could build the cost of his fee ($150) into the cost basis. I thought he might be advising me for free since he does a lot of work the the developer I sold the land to. There was no agreement (i.e. disclosure of fee schedule, scope of work, etc.) between us up front outlining that I would be charged. I can afford to pay the fee but the whole thing struck me the wrong way as I was unclear that I was on the clock. Am I obligated to pay him?

Pay the guy. Next time you call asking a professional for advice ask what his/her rates are up front. Don't expect a person who only has time to sell to give it away for free, they might, they might not.

smectym · Post by **smectym** » Sun Nov 24, 2019 12:48 am

Gill wrote: ↑Sat Nov 23, 2019 6:38 pm Pay the bill. Did you expect to consult a tax attorney for free? You got off cheap.
Gill

Agree. OP must pay, and pay promptly, without quibble or cavil. Sometimes just paying the bill is the smart and honorable course.

aude · Post by **aude** » Sun Nov 24, 2019 2:15 am

Pay it. It’s the ethical thing to do. If that carries no weight for you, consider that you should have a cancelled check showing you consulted counsel on this. Finally, what is your time worth such that it makes sense to spend this much time on a $150 tax deductible expense?

JoeRetire · Post by **JoeRetire** » Sun Nov 24, 2019 6:49 am

MrBobcat wrote: ↑Sun Nov 24, 2019 12:16 am
JoeRetire wrote: ↑Sat Nov 23, 2019 6:54 pm
Cosmic Pony wrote: ↑Sat Nov 23, 2019 6:25 pmI thought he might be advising me for free since he does a lot of work the the developer I sold the land to. There was no agreement (i.e. disclosure of fee schedule, scope of work, etc.) between us up front outlining that I would be charged. I can afford to pay the fee but the whole thing struck me the wrong way as I was unclear that I was on the clock. Am I obligated to pay him?
You thought you were getting free legal advice?
You'd be amazed (or maybe not) the number of people who call asking for free advice from professionals.

I'm not amazed. I was just wondering if the OP fit into that sad category.

Gill · Post by **Gill** » Sun Nov 24, 2019 6:59 am

Often quoted by lawyers is Lincoln’s quote, “A lawyer’s time is his stock in trade”.
Gill

nisiprius · Post by **nisiprius** » Sun Nov 24, 2019 7:00 am

OK, I do have one thought, above and beyond "just pay him."

1) If you have not received a written bill... either on paper or as an email... and if you feel sure that you and the lawyer think the thing is over, you asked a question, you got your answer... it would be completely appropriate to ask politely "when should I expect to receive a bill for this?"

2) Nothing about your story makes me suspect your lawyer of anything but being attentive to business.

But when you do pay, make sure that when they receive the payment in whatever form, at the same time they receive the invoice number ("invoice dated mm/dd/yyyy" if you can't find an "invoice number'), and a short description like "Payment in full for completed phone consultation on mm/dd/yyyy about cost basis for land sale."

HueyLD · Post by **HueyLD** » Sun Nov 24, 2019 7:04 am

When we used to get phone calls from those seeking free professional advice, we told them to come in so that we could help them.

With that, only the real clients would show up in person and the el cheapo ones would moved on to the next firm hoping for free advice.

Shallowpockets · Post by **Shallowpockets** » Sun Nov 24, 2019 7:06 am

Funny how people say pay the bill.Yet, if a doctor had been consulted for 5 minutes they might be upset to be billed $150.

nisiprius · Post by **nisiprius** » Sun Nov 24, 2019 7:14 am

Shallowpockets wrote: ↑Sun Nov 24, 2019 7:06 am Funny how people say pay the bill.Yet, if a doctor had been consulted for 5 minutes they might be upset to be billed $150.

1) I might well be upset. But I would pay.

2) One reason for the insurance choices I make is that I don't ever want to be billed directly for some chargemaster rate of $150, I want to see an explanation of benefits showing that the doctor billed the insurance company $150 and got paid $35.67.

3) I once accidentally wandered back into a suite of doctors' offices forty minutes after the office had closed. (I had left a sweater in an exam room, and was able to retrieve it). As I walked by the open doors of the doctors' offices, I was amazed by the busy sounds of them typing at computers and dictating notes. I suddenly realized for the first time that if a doctor sees you in an exam room for five minutes, she might be putting in more than the five minutes you see.

JoeRetire · Post by **JoeRetire** » Sun Nov 24, 2019 7:16 am

Shallowpockets wrote: ↑Sun Nov 24, 2019 7:06 am Funny how people say pay the bill.Yet, if a doctor had been consulted for 5 minutes they might be upset to be billed $150.

LOL! Do you think you wouldn't be charged for an office visit to a doctor?

(Remember, this wasn't a 5 minute consult with the lawyer either. Phone conversation. Document review. Second phone conversation.)

Most of us don't give away our professional time for free. Your mileage may vary.

carolinaman · Post by **carolinaman** » Sun Nov 24, 2019 7:57 am

Yes, you should pay. You should have known there was likely to be a cost involved, and should have asked him upfront what his fee would be. The fee is reasonable for what was done.

MikeG62 · Post by **MikeG62** » Sun Nov 24, 2019 8:53 am

OP, you requested and received tax advice, are only being billed $150 and you are asking if you are “obligated” to pay it?

I don’t know if you have a legal obligation, but it sure seems like you have a moral one. After all, this professional took time out of his day on several occasions to talk to you and review the material you supplied. My advice is to pay the man the tiny amount he billed you and thank him for his time and advice. It’s debatable that you would have have found any other tax attorney/professional willing to engage with you at all for this amount of money or anything close to it.

HoosierJim · Post by **HoosierJim** » Sun Nov 24, 2019 9:13 am

Shallowpockets wrote: ↑Sun Nov 24, 2019 7:06 am Funny how people say pay the bill.Yet, if a doctor had been consulted for 5 minutes they might be upset to be billed $150.

Unless it was an out of network surprise bill - then it would be $1000

I setup a billing system for a out of state customer once early in my career. I spent 2 hours on the phone with the customer to insure we got the details right and and probably 6 hours setting it up.

When presented the invoice, the client didn't want to pay for the 2 hours because we "were just talking". He could have easily been charged thousands more for this service from some other companies. The 2 hours of concise conversations helped enable the economical 6 hours of setup.

The $150 is probably the the cheapest legal bill you will ever see and if it got the job done - pay it.

avenger · Post by **avenger** » Sun Nov 24, 2019 11:25 am

It’s mind-bogging to me to even question the need to pay for professional advice.

petulant · Post by **petulant** » Sun Nov 24, 2019 11:27 am

It seems fairly unprofessional for the attorney to let you get this far without defining the billing arrangement and scope of representation. The fact that you have to ask this question based on the circumstances is not good. However, given the small amount involved of around $150, I think the advice to request a 1-2 page written, signed copy of his legal opinion and an invoice for the bill, then paying it, is the wisest course of action.