You need to ensure that when you hire various professionals you are getting your money’s worth.
Indeed, when you hire a lawyer, your chances of overpaying are considerable, says a legal expert.
The legal industry is “well known” for overbilling, according to the Philadelphia-based SIB Legal Bill Review.
While one can’t assume a firm is dishonest there’s fair chance one could be overcharged, says SIB Legal Review President Ryan Loro.
Overpaying by 30 Percent
“There is potentially 10-30 percent chance of legal bills for overcharging or over inflation of hours disguised as blocks analyzing this or focusing on that,” Loro says.
SIB Legal Review is a service monitoring legal charges, Block billing is a way of assigning one charge for several separate tasks, he adds.
Loro noted a recent arbitration report on billing.
“Since block billing has the potential of, among other things, camouflaging non-compensable tasks, many judges, fee arbitrators, and commentators regard its persistent and egregious use with suspicion, and some consider the practice a violation of Business and Profession Code,” according to “Analysis of Potential Bill Padding and other Bill Issues.”
The report was for the Committee on Mandatory Fee Arbitration of the California Bar Association.
Does Your Lawyer Really Do the Work?
An example of overbilling, say SIB Legal Review officials, could be a lawyer who charges $300 an hour and personally decides to make a three-hour drive to and from an off-site storage facility to retrieve records. The lawyer did it instead of letting a secretary, who makes much less, do it.
By packaging all the work into one bill over a monthly billing period and not documenting each day’s work, some lawyers inflate bills, says Joe DiGuglielmo, a vice president with SIB Legal Review.
Block billing, he adds, can still be used but clients should insist firms “document what they were doing each day of a billing period.” Without daily documentation, DiGuglielmo warns, some lawyers, reviewing a monthly work period, couldn’t prove “they did anything.”
Lawyer, Follow the Law
The American Bar Association, which didn’t respond to requests for comments on SIB claims, warns members to abide by Rule 1.5(a) of Professional Conduct.
“A lawyer,” the rule states, “shall not make an agreement for, charge or collect an unreasonable fee or an unreasonable amount for expenses.”
SIB Legal Review’s parent firm, SIB Fixed Cost Reduction, also reviews other professions.
Who Has “Itchy Palms?”
Legal professionals are most likely to overcharge DiGuglielmo contends. But he says others, such as dining and public relations pros, sometimes have itchy palms.
“There’s an old saying in my industry,” says a public relations executive. “The most creative thing a public relations professional will do is their hours sheets at the end of the week,” says INK CEO Dick Grove.
And Dining Alliance CEO John Davie says, “the restaurant food purchasing process is an incredibly complex one and simple mistakes can and often do happen if they are not constantly monitored.”