Simply adding the smallest unit of billable time (0.1 hour) onto a lawyer's daily timesheet results in an extra $10,000-25,000 in unearned fees in a single year, depending upon the lawyer's billing rate. In fact, many courts believe that block billing inflation is actually much worse, and will slash lawyers' block-billed time by more than half. 2007) (as a percentage penalty for block billing, most courts make a reduction ranging from 5% to 30%, consistent with the California State Bar committee's findings). See California State Bar Committee on Mandatory Fee Arbitration, Detecting Attorney Bill Padding, Arbitration Advisory 2003-01 (Jan.
According to the California State Bar, block billing causes lawyers to inflate the total hours billed to the client by 10-30 percent. Regardless of why it happens, the fact remains that block billing is big business for law firms - and a massive expense for those clients who are block-billed. MacEwen and Stanton, "Billable Hours", Adam Smith Esq. This sort of billable hour inflation is not necessarily the result of deliberate fraud, as lawyers are notoriously poor at keeping accurate and contemporaneous time records, and tend to overestimate the amount of time spent on a particular task.
Legal billing in excel full#
In this example, the client has been billed for a full hour, rather than seven tenths of an hour, which is the actual amount of time spent on the client's behalf, so the client is essentially paying the lawyer a gratuity of three-tenths of an hour. Phone call with plaintiff's counsel e-mail to client revise draft motion to dismiss. Unfortunately, in far too many cases, the final block-billed entry for these tasks will end up looking something like this: For example, after spending five minutes on a phone call, 35 minutes revising a junior associate’s draft motion and three minutes dashing off a brief e-mail to the client, the attorney should bill the client for seven-tenths of an hour. In theory, the total time charged equals the sum of the duration of each discrete task. One Block BillingApproximately 90 percent of law firm clients who are billed on an hourly basis are “block billed.” Block billing is an accounting technique whereby lawyers aggregate multiple smaller tasks into a single "block" entry, for which a single time value is assigned. This article summarizes some of the most common billing practices that lead to billable hour inflation. Clearly, clients must be proactive when it comes keeping billable hour inflation under control.
Ross, Professor of Law, Samford University, Attorney Billing Ethics Survey (2006-2007). However, two-thirds of lawyers admit that "bill padding" occurs at their firms, one-third of lawyers openly double-bill clients, and more than half of all lawyers perform work not because the client or case demands it, but because the lawyer needs to bill more hours. And while pundits have been predicting its demise for several decades, the billable hour remains the currency of the legal profession and seems likely to continue in that role for the foreseeable future. Introduction to the Unkillable BillableIt seems that scarcely a week goes by without an article appearing in a newspaper, journal or blog that proclaims the death of the billable hour. This article describes three common ways legal bills are inflated and provides tips to help clients identify problematic billing practices. But rare is the legal bill that does not include at least some "padding." In fact, according to the California State Bar, most bills are inflated at least 10-30 percent. Law firm overbilling - whether described as the euphemistic "bill padding" or simply "billing fraud" - is a serious problem that is seldom discussed and even less frequently addressed.
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