Late payment charges imposed by law firms

Law departments see on some bills and law firm engagement letters (See my post of Nov. 5, 2006 on engagement/retention letters by law firms.), a right asserted by the firm to assess a monthly service charge equal to one percent of all fees and disbursements which are past due. In one instance of this, the firm asserts a lien on all of the department’s files in its possession until it receives payment of all amounts due.

It is fair that law firms receive some recompense when payment of bills is long-delayed. Even so, it is probably rare that firms actually try to collect from clients any interest to which they are entitled – at least from those clients whom they want to keep serving.

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