How Detailed Should Billing Invoices Be?
Tips on how to craft billing invoices that are straightforward and succinct.
I’ve seen some bills that are more like a Haiku poem than an invoice for legal services, with two-word descriptions like “miscellaneous tasks” or “estate planning services,” followed by a bill for three or four hours of the attorney’s time. At the other extreme, I have reviewed bills that read more like “memos to the file,” with elaborate details of the nature of the phone conversations, the meeting with the client, or the letter to opposing counsel. Neither extreme is right, and figuring out what level of detail is “just right” is not a simple task.
The answer lies in a thoughtful understanding of what the purposes of invoices are in the first place. They are, I believe, as follows:
- keeping track of what you have done on the matter, with sufficient detail so you can explain what you did if anyone asks you in the future;
- letting the client know what you have done, so they can stay informed on the tasks you are doing and can evaluate whether the fees you are charging are fair and reasonable;
- maintaining a record of the work you have done, so that you can justify your fees if anyone ever questions them in the future; and
- recording your time in a manner that allows you to evaluate your overall efficiency and time allocation.
The Devil Is in the Details
Given these concerns, your billing entries should always describe the basic nature of the task (phone call, email, meeting, drafting of a letter, drafting of a legal pleading, attending a court session). Second, I generally recommend that some identification is included, such as the name of the parties you are writing to or meeting with or the nature of the court proceeding. Your own calendar and email archive should enable you to fill in the blanks about these events if you are asked later on, but mentioning the key participants is helpful to the client, so I would include that information as well. Finally, in most instances it is useful to add a word or two that refers to the general topic of the event, e.g. settlement discussions, property purchase agreement, or a restraining order application. Again, the purpose here is to educate the client on what work you are doing, so they can see that your fees have been properly earned.
My recommendation is leave it at that, and not include more details in the bills you send to your clients. I don’t think you should include the substance of your communications, nor should you include your opinions about what happened in the meeting. Those details belong in a confidential memorandum to your client, not in the invoice. Partially it’s an issue of attorney-client privilege: you can’t be sure who is going to review these bills, or if you might have to submit them to the other party for an attorneys fees dispute. You don’t want to have to redact portions of the bills later on, or inadvertently disclose your confidential communications when you make a copy of your invoice. It’s just not the right place for details like that. Your file should have your summaries of what happened at each event, clearly demarcated from the copy of the bill. One thing to consider: I regularly send emails to clients with a summary of phone calls or meetings, and then I can retain those as “memos to the file.”
It’s also a matter of efficiency in compiling your time records. Most billing programs offer an abbreviation function, which allows you to use shorthand for entries that are used regularly. Here are the ones I regularly use in my transaction and mediation practice—and this list covers nearly all the activities I do in a typical day.
rd review documents
tcc telephone call w/client
tco telephone call w/attorney
demc draft email to client
democ draft email to opposing attorney
dlc draft letter to client
rremc review and respond to client email
mc meeting with client
rremc review and respond to client email
demm draft email re mediation
For those of you who are litigation attorneys, you will want to create your own list of entries, such as interview clients and witnesses, drafting pleadings, compiling discovery, attending hearings, preparing for and taking depositions, and attending settlement or mediation sessions. Whenever you find yourself entering an activity more than a few times, add that to your abbreviation list, and then you can simply add the name of the person or the topic of the activity when you enter the specific activity on your timesheet.
Just remember to keep it simple and keep it short.
Frederick Hertz, an attorney and mediator based in Oakland, has managed his practice for more than 25 years.
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