Chapter Five: Fees and Billing

Question 1

attorney or paralegal hourly rate

Answer 1

Fee based on the attorney’s or paralegal’s level of expertise and experience in a particular area.

Question 2

client hourly rate

Answer 2

Fee based on one hourly charge for the client, regardless of which attorney works on the case and what he or she does on the case.

Question 3

blended hourly rate fee

Answer 3

An hourly rate that is set taking into account the blend or mix of attorneys working on the matter.

Question 4

activity hourly rate

Answer 4

Fee based on the different hourly rates, depending on what type of service or activity is actually performed

Question 5

contingency fee

Answer 5

Fee collected if the attorney successfully represents the client.

Question 6

flat fee

Answer 6

A fee for legal services that is billed as a flat or fixed amount.

Question 7

earned retainer

Answer 7

Term for the money the law office or attorney has earned and is entitled to deposit in the office’s or attorney’s own bank account.

Question 8

unearned retainer

Answer 8

Monies that are paid up front by the client as an advance against the attorney’s future fees and expenses. Until the monies are actually earned by the attorney or law office, they belong to the client.

Question 9

trust or escrow account

Answer 9

A separate bank account, apart from a law office’s or an attorney’s operating checking account, where unearned client funds are deposited.

Question 10

cash advance

Answer 10

Unearned monies that are the advance against the attorney’s future fees and expenses.

Question 11

retainer for general representation

Answer 11

Retainer typically used when a client such as a corporation or entity requires continuing legal services throughout the year

Question 12

case retainer

Answer 12

A fee that is billed at the
beginning of a matter, is not refundable to the client, and is usually paid at the beginning of the case as an incentive for the office to take the case.

Question 13

pure retainer

Answer 13

A fee that obligates the office to be available to represent the client throughout the time period agreed upon.

Question 14

court-awarded fees

Answer 14

Fees given to the prevailing parties pursuant to certain federal and state statutes.

Question 15

prepaid legal services

Answer 15

A plan that a person can purchase that entitles the person to receive legal services either free or at a greatly reduced rate.

Question 16

value billing

Answer 16

A type of fee agreement that is based not on the time spent to perform the work but on the basis of the perceived value of the services to the client.

Question 17

outside counsel

Answer 17

Term referring to when corporate and government law practices contract with law offices (i.e., outside of the corporation or government practice) to help them with legal matters, such as litigation, specialized contracts, stock/ bond offerings, and so forth.

Question 18

criminal fraud

Answer 18

A false representation of a present or past fact made by a defendant.

Question 19

time sheet or time slip

Answer 19

A record of detailed information about the legal services professionals provide to each client.

Question 20

billable time

Answer 20

Actual time that a paralegal or an attorney spends working on a case and that is directly billed to a client’s account.

Question 21

nonbillable time

Answer 21

Time that cannot be directly billed to a paying client.

Question 22

pro bono

Answer 22

Legal services that are provided free of charge to a client who is not able to pay for the services.

Question 23

overhead

Answer 23

General administrative costs of doing business, including costs such as rent, utilities, phone, and salary costs for administrators.

Question 24

leveraging

Answer 24

The process of earning a profit from legal services that are provided by law office personnel (usually partners, associates, and paralegals).

Question 25

prebilling report

Answer 25

A rough draft version of billings.

Question 26

aged accounts receivable report

Answer 26

A report showing all cases that have outstanding balances due and how long these balances are past due.

Question 27

timekeeper productivity report

Answer 27

A report showing how much billable and nonbillable time is being spent by each timekeeper.

Question 28

case type productivity report

Answer 28

A report showing which types of cases (e.g., criminal, personal injury, bankruptcy, etc.) are the most profitable.