3. Develop contingency plans for equipment failures. Have replacement equipment plans in place to avoid as much disruption as possible. If your communications fail, have plans in place that allow you to get back to normal as quickly as possible. Review your plans regularly.
4. Ask yourself what you can do on this day that is a marketing activity. If you think marketing everyday and do just one simple thing that fosters direct contact with prospective clients and/or referral sources, you will be executing a marketing plan. Something as simple as sending a copy of an article to someone with a personal note attached can pay dividends. One contact everyday equates to over 200 in a year.
4. Review your Accounts Receivable list at least weekly. If your bill isn't getting paid, you need to know why. Is it a financial problem with them--if so--how much farther are you willing to go with them--if not--is there a problem you need to resolve? Once an account gets past 90 days, the likelihood of collecting it diminishes drastically.
5. Develop a system where you record your billing activities on a daily basis--even better--as they occur. Waiting until the end of the week or the end of the month to record your time will result in large losses to you.
6. Be responsive to your clients. Have a system where you are sure you are regularly communicating with your clients. Nothing will undermine your relationship more than not communicating with them. This includes sending out regular billings.
7. Let your employees know you appreciate them. They are your most valuable asset. How do you feel when do a good job and somebody recognizes you?
8. Spend some time learning about new technology. Keeping up with new technologies will aid you in your practice and make you more efficient. It's likely many clients in the future will demand you incorporate those technologies in your dealings with them.
That's how I see it from my end. I don't have to worry about trials, depositions, or the other stuff, but you--if you're in a small practice--have to worry about it all. Try eliminating some of the problems by making a list--a checklist.
By Donald E. Weihl
While the practice of law is an honorable profession, a lawyer, like anyone else rendering services, is entitled to be compensated for those services. Even the most able lawyer will have difficulty discharging his own financial obligations if he or she does not develop a billing system that is timely, accurate and understandable.
Every attorney has a style for billing just as law firms have a style for billing. Attorneys and office managers have specific preferred formats that are imposed to cause uniformity in the billing process; however, it is the individual entries by attorneys that cause the impression received to be favorable or unfavorable when read by the bill recipient.
Hourly billing has emerged as the norm for much of the legal profession. When clients read the individual entries and the time associated therewith, it is important that the words used in the entries create a visual image of effort by the attorney that justify the amount of time entered.
Action verbs form the basis for the expression of effort that clients are looking for when reading a bill.
Individual entries do not indicate what result the effort achieved, and it is not the result that the client is looking for when reading an invoice for services rendered. Surveys have repeatedly shown that clients are looking for effort by the attorneys working on their behalf. The result or results may be years down the road when the client is reading the entries on the currently received invoice. The effort by the attorney is here and now action. Properly described effort is what causes the impression received by the client to be favorable.
There is not universal agreement on the words to be used to describe the effort listed in many entries, and there are exceptions to most billing rules. That notwith-standing, the smart money bet is that clients accept certain wording that has become historically repeated time and time again so that the sooner that language is used, the sooner the invoices make a favorable impression and are paid.
In no order of importance consider the following:
1. Avoid the use of the words "conference with."
Many insurance companies send out policy statements (often called "Guidelines for Attorneys") that state specifically that they will not pay for conferences between attorneys.
While policy statements don't provide that other conferences will not be paid for, it is just as easy to say "meeting with the consulting expert" as it is to say "conference with the consulting expert."
Since the word "conference" is the word that triggers a decision not to pay, it is simply better to avoid using it.
There are many exceptions to this. As an example, when there are three or more parties on a telephone call, it is customary to describe the call as a conference call. This is certainly acceptable as an entry description as are other instances where using the word "conference" has become an engrained custom.
Another example of an exception is when the client has provided authority for attorneys to confer for a specific purpose. Even then each attorney needs to bill the entry separately. When billing separately, it is still appropriate to avoid the use of the word "conference." The first attorney can describe preparing a memo to the second attorney directing action to be taken while the second attorney describes reading the memo and assembling information and data to perform the directed action.
Note that it is important to observe the client policy statement, or seek relief from the policy statement, or if it is not possible to comply with the policy statement, to so advise the client and come to an accommodation.
The ethics of the legal profession dictate that billing attorneys accept the terms of client policy statements to the letter exactly as attorneys look to the clients to perform their part of the engagement exactly by paying the invoice. Those same ethics require that billing attorneys not charge for legal services where there is unnecessary duplication of effort.
2. Avoid the use of the words "telephone conference with ..." when only two parties are on a telephone call.
Instead, say "telephone call to" or "telephone call from." The call to and call from language also helps when letting the client know effort is being expended on the client's behalf. Saying "call to" indicates action initiated by the client's attorney.
There is also a benefit in saying "returned call to" when the subtle message to be sent is that the attorney is not making the call to spend the client's money, but is responding to a call initiated by another.
3. Bill each action separately.
Putting the date and what action took place descriptively in as small bits as possible with as small an amount of time as possible makes it easy for the client to understand no over-billing is taking place.
4. Say "Read something received on '(date)'" and not "receive and read 'something'." The entry should make it clear that the effort was in doing something for the client as opposed to billing for receiving which involves no effort.
5. Itemize advances on behalf of the client on the same bill that the entry for the effort involved with the advance is itemized. For example, list mileage to the deposition or the airplane fare for travel to the deposition on the same invoice where the entry is "Prepare for and attend deposition of John Jones."
Contrast that with, "Travel to deposition of John Jones and return."
The client is paying for the windshield time or air time either way. The entry "Prepare for and attend" minimizes the impression of payment for travel.
6. Use the names of judges in entries where a judge is involved and the names of other parties involved with the entry where possible.
This is a simple matter of identifying the client matter with references that cause the client to recognize that the effort is on behalf of the invoiced client and not on behalf of someone else.
Experienced billing attorneys phrase entries so that the client realizes that the entry is on the correct client's bill. The most painful call involving a billing entry an attorney can receive is when the client calls to say that it appears that someone else's work has been listed on the client's invoice.
7. Phrase the entry in a manner that indicates what is being done.
Contrast, "dictate letter transmitting residence deed to client" with "organize information and assemble enclosures on Tom Jones' file and dictate report letter to Mike James."
It is simple to see that a transmittal letter may or may not require organization and assembly effort that is required in connection with a report letter. Suffice it to say that almost any description is better than an entry that says, "dictate report to client."
The caveat here is that certain words have to be used carefully. While it is permissible to bill for organizing facts or information in appropriate circumstances, it is not permissible to bill for merely organizing the file because the client expects the file to be organized at all times.
8. Don't bill for reviewing a file or reviewing a deposition or whatever.
The entry should be descriptive of what the attorney decides to do. What was the review for? Instead say, "assemble information for the preparation of a motion for sanctions" assuming, of course, that actual legal analysis and not mere organization of the file is involved. A client reading "Review file to prepare a motion for sanctions" can get the impression that the attorney has ignored the file and needs to refresh his memory before doing the work. While it is only a subtle difference, the combination of subtle differences may result in a negative impression on the part of the invoice recipient.
9. Prepare billing entries as the work is done.
Recreated entries are often recognized as fiction. Entries are easy when done simultane-ously with the work and effort involved. Stale entries are much more difficult to prepare and often are recognized as such by the client. Often the client only has one matter being handled by the attorney, and has a specific and fresh memory of the file details as they proceed. Recreated entries may not coincide with the client's memory of the matter because the attorney is working on multiple files and may have a memory that is less accurate than the memory of the client.
10. Cause the billing entries to have transition on the invoice and be in an order that the client can read to indicate the chronology of the work done.
In today's law offices there are often multiple attorneys working on a file at the same time. If the computer system of the firm enters time based on when the time entry was keyboarded, it is possible that an associate will perform work on a file before the delegating attorney has made his entry causing the associate to have the file. Many computer systems make it difficult to rearrange the order of time entries once the initial entries have been made; however, major client dissatisfaction occurs when one attorney's time is listed on the invoice prior to the time when the attorney could have done the work by reason of the chronological order of events. It goes without saying that when the ultimate bill is sent it should reflect a listing of individual entries that make sense to the client and can be followed from start to finish.
Conclusion
No two attorneys bill in precisely the same manner. No two clients perceive the entry language on invoices in exactly the same manner. There certainly is no universal agreement that dictates the items set out above should be followed. Attorneys need to utilize language that is friendly and makes it clear to the client that the client is important and that every effort to accomplish the desired result is being put forth on behalf of the client.
Notwithstanding the descriptive terminology used, do what you agreed to do, and only bill for that which fairly reflects actual substantive or procedural work necessary for the maintenance, defense or advancement of the client's cause or matter. Do not bill for things that you have already done unless such repetition is necessary. Nor should you additionally bill for those things that are a part of either your, or any firm's customary overhead or other expenses or everyday responsibility to its clients. Your normal hourly rate, or other appropriate manner of payment, should already have taken this into account.
As attorneys and professionals, we are obligated to put our clients interest before our own. Bill only for what is professionally needed on behalf of the client and remember that their interest is paramount to yours. For that matter, these suggestions are not meant to be all inclusive. Indeed, you should make sure to consult in depth and follow the professional responsibility rules regarding client billing. It goes without saying, however, that good ethics and good business go hand in hand. When clients recognize the contributions we make, the value of and payment for them become one and the same and that is truly rewarding.
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Donald E. Weihl practices in the St. Louis-Belleville firm of Greensfelder, Hemker & Gale, and is a past chair of the ISBA Law Office Economic Section Council dew@greensfelder.com
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