I recently reviewed a December bill from an insurer’s panel counsel that included time entries for work done in February. This reminded me that at this time of the year, I often see attorneys billing for work that may have been done many months earlier.
This billing for work done long ago occurs because attorneys (and paralegals) will go back through their files and review previously sent legal bills to see if those legal bills reflect all work undertaken in their files. This is being done as attorneys and paralegals scramble to get all their time billed out to clients in order to meet firm billing minimums or be eligible for firm bonuses.
When an attorney finds that work that has not been previously billed for, it is often due to the fact that the time for the work was not recorded on the attorney’s daily timesheet that is used to generate the attorney’s legal bills. And when time is not recorded contemporaneously when the work was done, the attorney will attempt to try to “reconstruct” that time by relying upon memory.
Where attorneys attempt to reconstruct their time for work done by relying upon their memories rather than contemporaneously kept time sheets, courts and legal commentators alike agree that attorneys tend to over estimate rather than under estimate their time. See, e.g., Ramos v. Lamm, 713 F.2d 546, 553n.2 (10th Cir. 1983). This is why courts often do not allow attorneys to collect on legal bills with reconstructed time based upon their memories or make across the board cuts in the legal bills. See, e.g., Johnson v. Univ. Col. of Univ. of Ala. in Birmingham, 706 F. 2d 1205 (1983)(11th Cir.).
To address this issue, company billing guidelines should require firms to bill their time on a either monthly or quarterly basis and require that the time billed be based upon time records filled out at the time the work was performed. Going a step further, billing guidelines could even prohibit billing for work more than a certain number of months (e.g., 3 months) after it was undertaken.
As an alternative to barring late billing completely, billing guidelines could require that legal bills with time billed for work that was more than a certain number of months in the past (e.g., 3 months) be accompanied by copies of the actual time sheets for those days the work was performed. (No contemporaneously made out time sheet, no pay.) This would help insure that the time billed for work on those days was contemporaneously recorded and not the product of an attorney’s overactive imagination.