I am a lawyer and I believe that a number of people in my profession may engage in questionable billing practices. I have three questions:
Question #1: Let’s assume a lawyer has 3 concurrent client cases that he is working on. The lawyer bills in 6-minute increments and charges $1,000 per hour. This means that even if the lawyer only spends 2 minutes on the client’s case, he will charge as if he spends 6 minutes on the client’s case and he will collect $100 (6 minutes / 60 minutes in an hour = one tenth; one tenth of $1,000 per hour = $100). However, instead of using 6 minutes to work on one client case, he uses 2 minutes to work on one client case, 2 minutes to work on another client case, and 2 minutes to work on another case. Now, instead of the lawyer making $100 for six minutes with one client case, he bills each of the three clients $100 and has tripled his income. Is this a legitimate billing practice?
Question #2: I bill a client for my time when I am working on their case even if my time is not being spent in court. For example, if I am driving to court for a client, I will still charge the client for my driving time. If I drive to court for one client and traffic is at a standstill, may I take advantage of this time stuck in traffic by working on another client’s case and bill both clients for the time?
Question #3: Much of my time is spent being in court via Zoom, which in California, is common practice. I am on Zoom in one court and I am case number 21 out of 25. I am required to wait on Zoom until my case number is called, so I put that case on mute and keep my eye on it until it is my turn. However, in the meantime, on another computer screen, I am in court in two other municipalities via Zoom, and I am also conducting research for a fourth client case. May I bill them all for my time?
Answer: There are four types of lawyers:
- Type A: Those who make up their hours based upon what they believe their client will ultimately pay (i.e. whatever they can get away with...).
- Type B: Those who try to keep their logs as honestly as possible but try to maximize their income.
- Type C: Those who keep their logs honestly and try to bill as honestly as possible without maximizing their income.
- Type D: Those who find the whole thing distasteful and do not bill by the hour, opting instead, to bill the client a flat fixed fee.
It is also important to note that impermissible billing practices may in some cases, render the lawyers to be thieves, Halachically. According to Halacha, thieves are not allowed to serve as witnesses until they return the funds that were stolen (which is unlikely to occur, as lawyers will likely not return monies to clients that have already been collected). Therefore, it is vitally important for a lawyer to provide a very detailed account of all of his billing practices in his client contract and obtain the client’s acquiescence.
Referring back to our four types of lawyers above, the Type A lawyer should repent and would be classified as a thief (with the implications of that classification spelled out above). He should ask his clients for forgiveness for his dishonest billing practices and return client monies that are owed.
Regarding the Type B lawyer, Rav Dovid Cohen Shlita believes that these lawyers are not considered thieves. However, it seems to me that this is an unsavory method of conducting business. The Type B lawyer should speak to his Rav and be guided accordingly. In any event, as mentioned above, it seems to me, that it is vitally important for a lawyer to provide a very detailed account of all of his billing practices in the client contract.
The Type C lawyer and Type D lawyer referenced above, are to be commended.
Now back to your 3 questions:
In response to Question #1, Rav Dovid Cohen Shlita ruled that this is technically permitted. Some are of the opinion that it is despicable to do so.
Regarding Questions #2 and #3, Rav Dovid Cohen Shlita ruled that it is forbidden to bill two (or more) clients for the same time, unless the lawyer and client agreed to the practice at the onset of the client relationship. Others believe that even if it was not agreed to, since it may be “Derech Sochrim” – standard industry practice, it does not necessarily render the lawyer a thief and a liar – [see Smah in Choshain Mishpat 228:16 on Shuchan Aruch 228:6 that states that when everyone (or perhaps most people) know that white color is added to meat to make it appear fattier then it is permitted, because that is the Minhag HaSochrim – standard industry practice]. To avoid any issue, the lawyer should disclose prominently in the client contract, that he has permission to bill two (or more) clients for the same time.
