4 Billing Mistakes That Can Land Unsuspecting Attorneys In Costly Fee Disputes
Ask any attorney in private practice about their least favorite task, and you’re likely to hear about billing woes. It can be time consuming, boring, and worst of all - you can’t bill for it. You might be tempted to rush through your billing at the end of the day, but your aggravation will only be amplified if you get a phone call from your client - or the bar - asking to audit your timesheets. To keep your bills on the right side of any dispute, these are four common mistakes to avoid:
1. Not Keeping Contemporaneous Records.
When you’re in the groove, it can be tempting to go from client calls into research and writing and just do your billing “later.” But if you don’t log your time while you’re doing it, you’re liable to make errors later on - and when you’re billing in six minute increments, there’s not a lot of room for mistakes. It’s fine to keep track on a piece of paper and enter it into your billing software all at once, but you don’t want to be trying to remember what you were doing at 10 a.m. when you just want to get to dinner.
2. Block Billing.
You know you spent three hours on one client this morning, but what were you doing? If you include “call opposing counsel, research notice requirements, draft motion to dismiss” in one three hour block, your client has no idea how much time you spent on each task - which makes it more likely that a fee arbitrator will cut some of your hours. Keep each task separate and you’ll be well prepared to defend the time you spent.
3. Vague Entries.
Related to block billing, vague entries make it hard to evaluate the reasonableness of your fees. At a minimum, each time entry needs a task and a brief description of the subject matter. Instead of “Phone call”, use “Phone call to opposing counsel re: lease terms.” When your client knows what you’re working on, they’re more likely to be comfortable paying for it.
4. Clerical & Paralegal Work.
One of the most frustrating billing issues for both attorneys and their clients are clerical tasks. Solos and small firms, who don’t have a large team of administrative assistants or paralegals, may be most affected by the rules against billing for clerical tasks like filing and binding briefs. But when hourly rates are hundreds of dollars, clients balk at paying for even six minutes of photocopying - and a fee arbitrator will absolutely dock those fees. A more subjective question is what tasks should be billed at a paralegal rate (or an associate rate, if you’re a partner), so as you’re working, ask yourself - is your expertise needed on this task? If you’re considering these questions ahead of time, you’ll be in a better position to justify your fees if they are challenged.
Most important of all, remember that client communication can head off a fee dispute faster than even the best billing practices, so remember Rule 1.4 and always keep your client in the loop!
For more information, check out these programs on Breaking Up with the Billable Hour, Best Practices for Ethically Managing Legal Spend, Ethical Considerations for the Solo Practitioner or Small Law Office and more.
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