By: Danielle Murphy, Paralegal
Anyone who has ever employed an attorney has probably found themselves a little confused when receiving their monthly bill from their lawyer. This is because attorneys have a very special way of billing that some laymen may not be familiar with. Unlike most things people have to pay for in their lifetime, employing a legal representative to represent your case is not a tangible exchange of goods for services, so it can be hard to understand where your money is going. To understand what your attorney is spending your money on, you must understand how attorneys bill.
When starting your case, the attorney will draw up a contract and quote you a retainer fee, and the type of retainer you are quoted will then determine how your case is billed. If your attorney quotes you a ‘flat fee’, this means that the entirety of your case from start to finish will be covered by your original retainer. Some attorneys, (typically those in personal injury) will quote a contingent fee, in which case you would only pay if the outcome of your case is favorable. The most common for family attorneys though is a ‘billable retainer’, meaning, the attorney will quote you an original retainer fee, which will then go into a trust account under your name, and the attorneys will bill against that trust account as your case progresses. If your trust account runs out of money at any point, your attorney may ask you to replenish your original retainer so that they can keep working, or they may send you an invoice for any outstanding balances. This method of billing is the one that clients often find the most confusing. Below is an explanation of how attorneys bill that time and turn it into a monetary value.
When operating on a billable retainer, 99% of the time attorneys bill their time in tenths of an hour increment scale with an hourly rate that can range anywhere from $100/hr to $1,000/hr depending on the attorney. So, for example, .10 of an hour is equivalent to 1-6 minutes of work, 0.2 is equivalent to 7-12 minutes of work and so on. In order to make this time into money, attorneys and their staff have to bill for every minute of their day. A working example of this would be, if your attorney spends 45 minutes (which is a 0.8 on the attorney’s billing scale) drafting a document for you they would then multiply 0.8 by their hourly rate in order to calculate how much money that document cost them to draft. They would then apply this process to any other work they do on your case which includes things like conference calls with opposing counsel, drafting pleadings, going to court, prepping your case for hearing, etc.
From time to time your bill may also include charges for operating costs such as, paying court fees, e-filing fees, requesting copies, printing, or mailing fees. Typically, your attorney will just pay for these out of pocket and then add the charges to your bill for reimbursement. Usually, this process and a breakdown of how your attorney bills will be included in your contract, but, if you are still confused about your bill or your attorney’s process after reading the contract or receiving your bill, you can always give them a call and they will be happy to explain the process to you.