If you feel like you are being overcharged, ask for an itemized bill and ask questions right away about specific items if they seem inflated or suspicious.
While most law firms charge their clients reasonably and ethically for the services rendered, unethical billing practices by lawyers are not unheard of. Some lawyers actively pad their bills for tasks that took less time than quoted or work that never happened. If the problem is left unaddressed, a senior lawyer may rake in tens of thousands of dollars in excessive fees every year.
How Some Lawyers Overcharge Their Clients
Here are the most common ways lawyers pad their bills.
Hoarding billable hours
Especially large firms are populated by the so-called ‘hoarders’ of billable hours as they get pressured by the higher-ups to bill more. To address this issue, most attorneys keep track of billable hours through special computer software that enables them to record the starting and stopping times of a specific task and particular client.
These records can be later used in court if a client feels that he or she has been overbilled by their legal counsel. If there’s not enough evidence of billable hours or if the bill has been obviously padded, a judge may trim excess hours.
But excess billable hours are not always caused by fraud. Some attorneys are proverbially bad at keeping accurate time records, with some of them even underestimating the amount of time and work spent on a client or case. In the worst-case scenario, your attorney may use notepads, memos, calendar entries, emails, and his or her memory to re-create the exact number of billable hours.
If that happens keep track of all interactions with your lawyer and hold him or her accountable. A flat fee arrangement right from the start can also help prevent this scenario.
Charging paralegal or attorney rates for lower-level work
Billing for secretarial or clerical work at premium rates is a form of bill padding and double billing. Clerical tasks should not be charged separately because paralegals and attorneys are already paid through hourly rates. Secretarial work such as word processing, picking up copies, photocopying documents should not be billed for separately at a paralegal or lawyer rate either.
In Missouri v. Jenkins, the U.S. Supreme Court was quite clear: “purely clerical or secretarial tasks should not be billed at a paralegal rate, regardless of who performs them” even when the lawyer has to perform them since no other help is available at the moment. “[The] dollar value of [lower-level work] is not enhanced just because a lawyer does it,” SCOTUS concluded.
Another way some lawyers overcharge their clients is by billing “hours” in excessively high increments like 30 minutes or one hour. This means that if you talked on the phone with your lawyer for ten minutes you’ll be billed as if the call lasted 30 minutes if 30-minute increments are used, or an hour if one-hour increments are employed. There are even horror stories about attorneys discussing with clients for a few minutes on their lunch break and ultimately billing them for the entire hour they needed for lunch.
How to protect yourself from being overcharged
There are several steps to take to avoid being overbilled by a law firm.
Get everything in writing.
Get everything you agree to pay for in writing from the get-go, like the hourly rates of every attorney and non-attorney who will be working on your case along with any cost-related details such as:
- Hourly rates of private investigators
- Court fees
- Appearance fees for depositions
- In-court hourly rates
- Billing increments (with a request to be properly recorded)
- Down payment
- Per-page rates for transcript copies, etc.
It is also best to agree upon a budget and ask the attorney to stay within that budget. For everything that goes beyond it, your attorney should contact you and ask for your permission to proceed.
Flat fees are your friend.
Never agree to be billed by the hour by a lawyer unless you are in prison or you are about to go into a messy child custody battle. Moreover, look for an attorney who works on a contingency basis, like this Orlando personal injury attorney, which means that the attorney will get paid a percentage of the final settlement or court award only if he or she wins your case. Whatever you do, steer clear of hourly rates.
Request an itemized bill & negotiate.
If you feel like you are being overcharged, ask for an itemized bill and ask questions right away about specific items if they seem inflated or suspicious. Negotiate if you feel like you are being overcharged and keep tabs on your lawyer by scrutinizing the bills on a regular basis.
A lawyer who is aware that you will be keeping an eye on him or her is less likely to pad the bills. However, don’t overdo it. If you fall into the trap of nitpicking, you risk being dropped by your attorney for being a difficult client. Other attorneys might steer clear of you too if they find out the real reason your former lawyer renounced you as a client.