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Cox: Time records and billings are important risk management tools

Dina M. Cox
April 9, 2014
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protecting practice dina coxIt’s sad but true: The work product of an attorney that clients study most closely is the attorney’s bill. Because of this close scrutiny, coupled with your own standards of professionalism, it is important that your time records and any invoice for services sent to the client be clear, detailed and accurate. Maintaining high standards when it comes to time keeping and billing means that you are more likely to be paid, and paid on time; better able to communicate your value to clients; and, effectively documenting your efforts, energy, and file. Good time keeping and billing fosters healthy attorney-client relationships, and these relationships are less likely to end in a claim or lawsuit. If a claim or lawsuit is filed, detailed and accurate time records can assist in disproving the allegations of malpractice.

Time records and bills should be proofread and edited before being finalized or presented to the client. Misspelled names, lack of consistency, tasks billed to the wrong file, or tasks billed at the wrong timekeeper level or rate can irritate even the most patient and loyal client. Moreover, if the theme of a former client’s claim against you is that you were too busy to give the matter sufficient attention, then error-filled, sloppy time records will only underscore this theme.

When editing and proofreading time records and bills, consider whether work that an attorney did should be adjusted to the paralegal rate for tasks that could have been handled by a paralegal. Consider whether certain tasks should be shown on the bill, but entered at “no charge.” Make sure that the descriptions of the services performed can be understood by the client reviewing the bill. Will the description of the task itself justify the time spent? Each entry should identify what was done and why. When the client is finished reading the bill, she should have a clear understanding of what you and your staff did for the last billing period and why, and she should also be left with the impression that the matter was given sufficient attention and that the time spent on the matter by each timekeeper was reasonable.

An itemized invoice for services rendered gives visibility to work product of the attorney that is otherwise invisible to the client. A great example is legal research and analysis that is not reduced to a memo or report sent to the client. Because clients often don’t see their attorney’s work product on a day-to-day basis, and sometimes rarely see tangible work product at all, an itemized invoice can illustrate to the client the amount of time and energy that the attorney is investing and on what subjects. A monthly invoice can also serve to update the client on the status of her matter when no substantive update or report has been sent within the last 30 days.

Detailed billings or time records can also help in the defense of a claim or lawsuit that is brought against the lawyer or law firm. Often, the very first item a professional’s defense attorney will review is the professional’s time records. If complete, these time records provide a tidy timeline of the representation, they document the dates and subject matter of communications on the matter, and they may illustrate the diligent attention that the attorney and his staff paid to the matter.

Time records can also be a good way to document that you performed certain work that is part of due diligence. For example, telephone calls to the client explaining a certain issue in the case (“Discussion with client explaining ramifications of not naming ABC Corp. as a defendant in the complaint”). Then, when the client claims “you never told me what might happen if we didn’t name ABC as a defendant,” you have not only your memory to challenge that assertion, but you have a time record as well, which the client presumably reviewed when he paid the bill. But be forewarned: If you are a meticulous time keeper, the absence of a time record on a particular task can be significant as well. As the saying goes with medical records, if it isn’t documented, it didn’t happen.

It is also worth mentioning that lawsuits for unpaid fees should be carefully considered. A lawsuit for unpaid fees should not be filed unless it is absolutely necessary or warranted. Aggressive collection efforts and suits for fees are often met with malpractice claims against attorneys or disciplinary grievances.

Accurate and clear billings by lawyers can serve as a powerful risk management tool. Satisfied, well-informed clients rarely sue or bring claims, even in the face of a legal error. A lawyer is more empowered to resolve disputes or errors with a satisfied, well-informed client. A detailed, timely, and accurate itemized invoice for services rendered can keep your clients satisfied and well-informed. Detailed time records can also help defend against complaints lodged against you.•

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Dina M. Cox is an attorney with Lewis Wagner LLP in Indianapolis. She focuses her practice on professional liability defense, drug and medical device/products liability defense, consumer class-action defense, insurance coverage, and insurance bad-faith defense litigation. The opinions expressed are those of the author.

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  1. So that none are misinformed by my posting wihtout a non de plume here, please allow me to state that I am NOT an Indiana licensed attorney, although I am an Indiana resident approved to practice law and represent clients in Indiana's fed court of Nth Dist and before the 7th circuit. I remain licensed in KS, since 1996, no discipline. This must be clarified since the IN court records will reveal that I did sit for and pass the Indiana bar last February. Yet be not confused by the fact that I was so allowed to be tested .... I am not, to be clear in the service of my duty to be absolutely candid about this, I AM NOT a member of the Indiana bar, and might never be so licensed given my unrepented from errors of thought documented in this opinion, at fn2, which likely supports Mr Smith's initial post in this thread: http://caselaw.findlaw.com/us-7th-circuit/1592921.html

  2. When I served the State of Kansas as Deputy AG over Consumer Protection & Antitrust for four years, supervising 20 special agents and assistant attorneys general (back before the IBLE denied me the right to practice law in Indiana for not having the right stuff and pretty much crushed my legal career) we had a saying around the office: Resist the lure of the ring!!! It was a take off on Tolkiem, the idea that absolute power (I signed investigative subpoenas as a judge would in many other contexts, no need to show probable cause)could corrupt absolutely. We feared that we would overreach constitutional limits if not reminded, over and over, to be mindful to not do so. Our approach in so challenging one another was Madisonian, as the following quotes from the Father of our Constitution reveal: The essence of Government is power; and power, lodged as it must be in human hands, will ever be liable to abuse. We are right to take alarm at the first experiment upon our liberties. I believe there are more instances of the abridgement of freedom of the people by gradual and silent encroachments by those in power than by violent and sudden usurpations. Liberty may be endangered by the abuse of liberty, but also by the abuse of power. All men having power ought to be mistrusted. -- James Madison, Federalist Papers and other sources: http://www.constitution.org/jm/jm_quotes.htm RESIST THE LURE OF THE RING ALL YE WITH POLITICAL OR JUDICIAL POWER!

  3. My dear Mr Smith, I respect your opinions and much enjoy your posts here. We do differ on our view of the benefits and viability of the American Experiment in Ordered Liberty. While I do agree that it could be better, and that your points in criticism are well taken, Utopia does indeed mean nowhere. I think Madison, Jefferson, Adams and company got it about as good as it gets in a fallen post-Enlightenment social order. That said, a constitution only protects the citizens if it is followed. We currently have a bevy of public officials and judicial agents who believe that their subjectivism, their personal ideology, their elitist fears and concerns and cause celebs trump the constitutions of our forefathers. This is most troubling. More to follow in the next post on that subject.

  4. Yep I am not Bryan Brown. Bryan you appear to be a bigger believer in the Constitution than I am. Were I still a big believer then I might be using my real name like you. Personally, I am no longer a fan of secularism. I favor the confessional state. In religious mattes, it seems to me that social diversity is chaos and conflict, while uniformity is order and peace.... secularism has been imposed by America on other nations now by force and that has not exactly worked out very well.... I think the American historical experiment with disestablishmentarianism is withering on the vine before our eyes..... Since I do not know if that is OK for an officially licensed lawyer to say, I keep the nom de plume.

  5. I am compelled to announce that I am not posting under any Smith monikers here. That said, the post below does have a certain ring to it that sounds familiar to me: http://www.catholicnewworld.com/cnwonline/2014/0907/cardinal.aspx

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