Reviewing entries in a legal bill involves more than reviewing those entries for compliance with a company’s litigation and billing guidelines. It also involves reviewing the entries for ”reasonableness” as that term has been defined by the ABA Rules of Prof. Conduct and well settled case law.
Reviewing legal bill entries for reasonableness always involves reviewing for three things:
- The reasonableness of the “task” performed
- The reasonableness of the ”person” performing the task
- The reasonableness of the ”time” spent performing the task
In my seminars on How to Review Legal Bills Like a Pro©, I often ask participants what do they look for first when they review a legal bill. Many times the answer back is they look first at the time billed for the tasks. However, that is the last thing that should be looked at when reviewing a legal bill.
To properly review a legal bill (and save time), it is important to follow a disciplined 3-step approach.
The first step in reviewing any legal bill entry is to look at the reasonableness of the “task” preformed. If the task is not appropriate or reasonable, then it is irrelevant and pointless to further examine the task to determine the reasonableness of who performed the task or the reasonableness of the time spent performing the task. For example, if the task is a “clerical” task, it makes no difference who performed the task even if an attorney performed the task. See Johnson v. Ga. Highway Express, Inc., 488 F.2d 714 (5th Cir. 1974)(“The value of a service is not enhanced just because lawyer does it.”).
If it is determined that the task is reasonable or appropriate to do or bill for, then the next step in the process is to look at the person performing the task. If the person is inappropriate, then it is a waste of time to look at how much time that person spent on the task.
For example, an inexperienced associate may take longer to perform certain tasks than an experienced paralegal. This is because one of the reasons associates rates are lower is because associates often lack the experience of partners to be more efficient (i.e., quicker). But the point is that only after first determining the reasonableness of task and then the reasonableness of the person performing the task is it appropriate to review for the reasonableness of the time billed for the task.
Of course, reviewing legal bills for the reasonableness of the task and the person performing the task are relatively easy to do when compared with reviewing the time billed to perform the task. Lists of tasks that are billable or non-billable as well as lists of tasks that should be performed by a partner or an associate or a paralegal can be easily compiled for reference. But, it is not so easy to compile a list of how much time it should take to perform tasks.
But instead of spending time trying to compile a list of permissible time to perform tasks, it may be better to apply some basic “rules of thumb” to how much time is should take to perform certain tasks. For example, there are rules of thumb you can apply to determine how much time it should take for an attorney to review a single document or a banker’s box full of documents (2,500 pages). I will give you those rules of thumb as well as some others in my next post.
I have trained both file handlers as well as legal bill review units at insurers and other types of companies. If you are interested in legal bill review training that can be tailored to the needs of your staff, please contact me at john.conlon@theCLM.org.