Mastery of ethical and efficient billing is a cornerstone to the success of any legal practice. It is a skill that can lead to immediate results in productivity and profitability. Particularly for newly admitted attorneys, learning the ins and outs of successful billing practices goes a long way to ensuring you meet billable requirements and that your time is captured accurately. This article offers a refresher on best billing practices for seasoned billers and a roadmap for newer attorneys.
Make Daily and Accurate Billing a Habit
Recording time on a contemporaneous, or at least daily basis, is a practice that should be a habit for all attorneys. Waiting days or weeks to enter time will inevitably result in less time being recorded, and as a result, less profitability. Establish a habit—either at the end of each day or the beginning of the next—to make sure your time is current. Waiting risks losing time that cannot be recaptured, or worse, can result in an unintended, but nevertheless problematic, overstatement of time. A client paying hundreds of dollars per hour for your time likely knows how long your telephone conversations were, and will not appreciate a misstatement of your time even if unintentional.
Track your time throughout the day. Whether on a notepad, timesheet, or even a dictation, keeping a record will help avoid mistakes. Also, while all attorneys experience distractions or other emergencies that cause deviation from what you had hoped to complete in a day, do not bill prospectively. Consider the example of a Massachusetts attorney who was suspended from practice for billing clients “for services that were not rendered.” See in the Matter of Zankowski, 487 Mass. 140, 141 (2021). In determining that a two-year suspension was the appropriate quantum of discipline for padding client bills with unworked hours, the Supreme Judicial Court of Massachusetts found that the respondent “inflated the amount of attorney time billed to her four largest clients by approximately 450 hours, falsely ascribing to herself and other attorneys work that was not actually performed.” Although an extreme example, make sure your timesheet matches your day.
Be mindful of “double-billing.” Although lawyers may accomplish miracles in the courtroom, there are still those who think they can expand a day beyond 24 hours. It may take a miracle to avoid the consequences of such actions. See e.g., Lawyer Disciplinary Board v. Hassan, 241 W. Va. 298 (2019)(suspending a lawyer who had “billing practices that resulted in impractical absurdities such as billing 30 or more hours on multiple days.”); In re Entin, 287 A.D.2d 943 (N.Y. App. Div. 2001)(disbarring a lawyer who billed clients 24 to 33 hours per day on multiple occasions)). For example, although you may be traveling for one client, you cannot bill for travel time when working on other matters at the same time. Developing good habits avoids these issues and prioritizes your individual success.
Details, Details, Details
A billing statement is a lawyer’s record that justifies the fees to a client for professional services. When bills containshort or otherwise insufficient descriptions, clients may be left confused and dissatisfied. When referencing telephonecalls, indicate to whom you spoke and the general topic. When billing for research, describe the issue with specificity.Avoid words like “worked on” or “reviewed.” Clients pay for expertise and your ability to “draft” a brief, or “analyze” anadversary’s discovery responses. Make sure your billing descriptions adequately convey what clients are being chargedfor and that they are consistent with their expectations.
Detailed bills also provide an additional line of defense in malpractice actions. They frequently serve as corroboratingevidence of when and how something happened. For example, a client may deny that a conversation occurred, andwithout a confirming letter or e-mail, a billing entry may be the best evidence that the conversation occurred.
While vague billing entries can create unnecessary friction with clients, they also can hamper the ability to collect or recover fees. See Sherrets, Smith & Gardner v. MJ Optical, 259 Neb. 424 (2000)(reversing award of recovery of fees to law firm because, in part, “the descriptions of the services performed were brief and cryptic” on several time entries.”).In order for an attorney to recover legal fees for services rendered, a court must first make a determination that the charges are fair and reasonable. ABA Model Rule 1.5. If a court cannot determine the reasonableness of your actions from your time entries, one cannot reasonably expect to collect what was billed. For example, a law firm was precluded from recovering fees from a client because the court found that its “billing entries were too imprecise to deduce the reasonable amount of attorney’s fees.” See Barry Mallin & Associates v. Nash metalware,18 Misc. 3d 890, 896 (N.Y. Civ. Ct. 2008); see also In re Estate of Johnson, 119 P.3d 425, 436 (Alaska 2005)(concluding that law firm “failed to meet its burden of proving the reasonableness of at least $68,500 in fees because” many of “the entries in the billing records were too vague to establish whether the charges were reasonable for any given matter.”)).
Finally, while detail is generally a good idea, be mindful of issues of privilege and confidentiality. For example, if you anticipate submitting bills as part of a fee application in a fee shifting case, do not include the substance of communications with your client in the bill, but instead focus on topics discussed. Also, be sure to review bills for confidential and privileged information before filing with the court and submitting them to an adversary and redact as appropriate.
The Bottom Line
To bill successfully, make daily billing a habit, record time contemporaneously, and be sure to include sufficient detail in billing entries. It will help you get paid for the work you do.
Reprinted with permission from the February 23, 2023 edition of The Legal Intelligencer © 202X ALM Global Properties, LLC. All rights reserved. Further duplication without permission is prohibited, contact 877-256-2472 or reprints@alm.com.