Why Are Lawyers So Expensive Even With The Excess Supply Of Lawyers?

You're not paying a lawyer $X00/hour to do word processing; you're paying them to figure out what laws apply to your situation, how those laws apply, and the best course of action given the legal consequences.

If they're doing word processing, it is because the language matters. Consider that the City of Cleveland lost the Cleveland Browns to Baltimore over a comma which completely changed the meaning of the exit provisions in the contract. The owner of the Dodgers likewise lost a $500 million stake to his ex-wife based on the language in his prenuptial.

Finally: if you want easy access to documents in the court docket: go to the courthouse where they are kept. It costs a lot of money to implement and maintain a digitizing system, and most courts simply do not have the resources to maintain such systems.

I used to "hire" law firms regularly for my clients. What's not being mentioned here is that since in most cases the individuals _choosing_ the law firms for large financial and M&A transactions (which represent the real meat of the "big law" business) generally aren't directly paying the legal fees, there's relatively little incentive for them to push for lower prices. (And if I remember correctly, if those legal fees are part of a financing transaction, they don't count against the businesses "normalized/adjusted" income, either.)

If I'm the CFO of a company that's doing a $500M financing round, am I really going to choose a lesser law firm to save maybe $100K in bills? I'm already probably paying the bankers $5M or more to do the deal in fees (arguably, that's the real gouging, given that the work doesn't really scale with the deal size but the fees do.) If I choose a cheaper firm, and they mess up (and frankly, all the firms make mistakes, especially when you have junior associates drafting filing docs) it could cost me my job.

(The most cost-conscious clients I've seen were entrepreneurs or at least majority owners of businesses - they saw those fees as coming right of out their own pockets, so they tried to do whatever they could to keep them down)

In-house counsels are definitely trying to push down costs by doing more things internally or offshoring more mundane stuff like day-to-day contracts. But at the same time, most of your in-house counsels come from a big law firm, so they're unlikely to break away completely, either.

> That's easy. The expense of a car or plane doesn't indicate it's safety, infact it's usually the opposite, the more expensive the car or plane the faster it goes and less safe it can make your trip.

> With a doctor or lawyer more often than not the more you pay the better the service/advice you get.

Do you know this, or do you just believe / hope this? I'd argue that the actual quality of service delivered (not just how nice their suits or offices are) is very difficult for customers to assess. At least with cars, there are independent ratings agencies that will tell you that your more expensive car is actually safer. (Doctors actually have stats like mortality and length of hospital stay.)

Fun fact: in California and New York, you are legally required to inform the new owner that the fan was not installed by a licensed electrician if the installation involved any more electrical work than simply plugging it into an outlet.

You would not be entirely responsible for killing the future owner...but yes, under the doctrine of negligence, you would be at least partially responsible for killing the future owner. In fact, this is one of the first things you learn in your first year of law school.

The unlicensed kid: That depends on how he cuts off his foot. Was he distracted? Was your wife distracting him at the time sunbathing nude next to the pool? Was he using your mower? Was your mower broken?

Unlicensed painter: Also depends on the specific facts. Was it his ladder? Why did he fall off the ladder? What did he fall onto? Would such a fall normally have killed a person? What special facts in this situation resulted in the painter's death?

Protection from damage: You're spot on. In fact, in Ohio, you're required to hire only licensed and bonded (i.e., insured) contractors for renovations or construction work. Moreover, contractors are required to provide proof of license and bond before they begin work or try to collect payment.

Lawyers regularly get in very severe trouble for breaches of legal ethics. The Enron, etc, examples aren't availing. Lawyers are required, legally, to rat out other lawyers for violations of legal ethics. They are not required to rat out their clients (and indeed are ethically prohibited from doing so). I'm sure lots of lawyers knew about Bernie Madoff and Enron, etc. But they were legally obligated not to disclose their clients' crimes.

Moreover, in your hypothetical, it's not just James Lawyer who can report the business practice. A judge reviewing a claim of attorneys fees could find something suspicious. An in-house guy reviewing bills could find something suspicious. Somebody at another law firm working jointly on a case could find something suspicious. Those people have no disincentive to report that conduct, and indeed their ass is on the line if they do not.

Do lawyers charge you for time while thinking about your case in the shower? Probably. Like any contractor, there is some margin for estimation while remaining ethical. But is there some grand conspiracy to systematically over-bill clients? There are just too many people who would have access to that knowledge, and who could only get in trouble for not ratting it out for that to be likely.