Carol Bailey Kills the "Billable Hour" with Law Firm Targeting Middle America

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Even before Occupy Wall Street protestors held up signs with the slogan "make a living, not a killing," family law attorney Carol Bailey adopted the saying as her personal motto. It was about a year ago, and she was charging $330 an hour. With 30 years experience under her belt, she could have charged even more.

Instead, she decided to go in the other direction. A couple weeks ago, Bailey opened a new firm that does away with the so-called "billable hour" and offers clients flat fees that are far cheaper than what they would typically spend for an attorney.

"We're trying to reach a whole different group of people," Bailey says of her four-person firm, Main Street Law Group. The firm's self-declared target market is "Middle America," or simply those fed up with the current system, including lawyers themselves. Bailey recalls one colleague of hers who spent a million dollars on his divorce. "The guy was so bitter about the bill he got from his lawyer," she says.

And why not? Her colleague, of all people, knows that attorneys are motivated--indeed often required by their firms--to bill as many hours as they can so that they can make as much money as they can. Every time a lawyer asks how you are, shares a funny story or launches into a long-winded explanation, that's all going to cost you.

It's a model, according to Bailey, that breeds distrust, inefficiency and--since lawyers make more when time is spent fighting in court--conflict.

A range of legal industry watchers across the country have started calling for change. (See for instance, an August op-ed in The New York Times entitled "Addressing the Justice Gap.") A smattering of firms across the country, like Washington D.C.'s Clearspire, have started answering that call.

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Main Street, which shares space with a more traditional and still ongoing firm Bailey founded, promises to tell clients how much it will charge them in advance. Some of those fees--specifically in cases involving business law and wills and estate planning--can be found online. Others, in more complicated areas of the law, will be determined after the first meeting.

Bailey says Main Street will also encourage clients to do much as work on their cases as they can without an attorney. What most lawyers never tell you, she says, is that clients can do much of the paperwork themselves. Or they could, if going through a divorce, negotiate with soon-to-be exes using a less expensive mediator. "When you get to the point that you don't feel like you know what you're doing, call me," Bailey told a recent client. For her specific part of the case, Bailey might end up charging $3,000 to $5,000-- far less than the $25,000 to $30,000 that is usually the minimum in divorce cases.

Is this pure altruism? Not entirely. What Main Street's lawyers get out of the deal, besides an untapped market, is flexibility. All the other attorneys in the firm, besides Bailey, are young mothers who don't want to be trapped by the standard you-must-bill-so-many-hours mandate. One lawyer wants to work three days a week. Another wants to quit early when her kids come home from school. The third is planning a maternity leave. And Bailey? She's taking a month-long vacation to Greece next summer.

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