‘If you carry on talking to me Haresh for a few more minutes, I can bill my client into the next unit,’ said an instructing Solicitor to me as I rolled my eyes and opened my mouth in shock.
When I talk to people who have hired legal services, I am often saddened to hear the experiences they have faced when it came to billing on their file. Moreover, I am often surprised at how many people do not understand how they have been charged for the work they instructed their Solicitors to do. Fortunately, I have trained under some wonderful lawyers who have always taught me to ensure client monies are spent in a frugal manner to ensure that the key ingredient between them and the lawyer are always retained; that being of, trust and confidence.
Types of billing
Most Solicitors bill in a similar manner under various categories such as, consideration, advice, telephone calls, preparation, routine emails and drafting etc. However, when a client receives a bill which seems excessive and headed under many of these subheadings, they should always check how the costs were calculated. With the bill, there should be a time ledger, which in essence is like a receipt. This should provide a breakdown in minutes and hours on how costs were calculated task by task. If this is not included, ask for it. If you are told, one does not exist, them challenge the bill if you have a doubt.
Unit billing v fixed fees
In all the time I have studied, taught, and practised law, I have rarely met people who know how Solicitor billing works (on the receiving end). Therefore, here is an explanation. In short, each hour is divided into 10 units, and 6 minutes equate to 1 unit. Whatever the Solicitors hourly rate is, this will be divided by the 10 units (1 hour). For example, if the Solicitors hourly rate is £200 per hour plus VAT, then each unit will be £20 plus VAT (£24 to be precise). Consequently, if your Solicitor spends 2 units on your file doing a task, such as reading a letter, sending an email or anything else, they will bill you £40 Plus VAT (£48). However, bear in mind some are more rigorous at billing than others, and even if a client speaks to the Solicitor for 13 minutes (1 minute more than 2 units at 6 minutes), this could be billed as 3 units as the time will be 13 minutes, as it has encroached into the 3rd unit. I know this seems very mathematical, but it is quite simple. Therefore, always remember, your Solicitor is not providing a ‘phone a friend’ service. Do not ring them to tell them to tell them how you are feeling about the case and spend two hours crying about it unless you have £400 plus VAT (£480) to give away. They are not a counsellor; they are trained professional legal advisors who are instructed to achieve your end goal whatever that may be in your litigation.
Some previous experiences
Before practising, I had hired legal services myself and became disappointed at the unexplained high level of costs I was once facing. Luckily having trained in law and having done some work in this field, I was able to identify costs which appeared questionable. For example, I once recall charges on the time ledger for ‘research’ on a particular case. I also noticed extensive time taken to read one- or twopage letters, such as 30/45 minutes which a child from a year 7 English class at school could have read in 5 minutes. All of these were signs of over billing. Ultimately after challenging the bill at the Senior Courts Costs Office and tearing it apart with the assistance of a cost’s draftsman, the bill was knocked down to £12,000 from £36,000 plus VAT, yes £24,000 of overbilling in my view. There are many examples of these cases If you go the Solicitors Regulation Authority Disciplinary Tribunal Section and search for those cases where sanctions have been imposed for mishandling ‘client money’. https://www.solicitorstribunal.org.uk/ .
Always state you are disputing the bill before demands and threats start coming your way for bills you are unclear about. The reason being, if for example you are issued a statutory demand, or anything else, make sure you state you are in ‘dispute’ already.
Examples and signs of overbilling.
As a Barrister who is authorised to conduct litigation and having trained as a Solicitor, I can easily identify when Solicitors against me are excessively billing their clients. Examples include.
- Writing unnecessary and extensive emails to me or the Court which inadvertently or advertently invites me to provide a response.
- Disputing issues which have no relevance to the case, nor any merit.
- Filing Applications in Court without attempting to agree consent on matters which leads into a costly dispute.
- Ignoring settlement opportunities and extending the litigation battle.
- Spending hours on admin tasks such as bundle preparations i.e., 5 hours.
- Engaging 2 or more Solicitors in the firm at different hourly rates when the file could simply be managed by one competent solicitor.
Smelling a rat
If you feel your legal bill is too high, or unexplained, always speak up and ask your Solicitor. Analyse it very carefully. If it says 1 hour for a phone call and you know you only spoke for 20 minutes, challenge it. I have heard no end of complaints concerning this subject when clients bring these disputes to me. You should also keep a log of the points of dispute which you wish to raise (whether at the time or later). However, ideally, you should raise the concerns as they arise.
What to do
If you do suspect you are being overcharged you have several options. Always ensure, you exercise these in writing.
- Ask the Solicitor to breakdown their fees and charges per task. For example, if you notice they have billed you for considering a 1-page letter at 45 minutes. Ask them how this was done? Put them on the spot.
- If you are still not satisfied, raise a complaint with a senior in the firm. If this does not work, then read on.
- Challenge the Bill in Court. Please see; https://www.gov.uk/challenge-solicitors-bill/how-toapply
- In addition, you could complain to the Legal Ombudsman, although they mostly focus on service issues.
- Alternatively, you could report the Solicitor to the SRA.
- Or appoint a costs draftsman to
- And finally, change Solicitor or go to a Direct Access Barrister and take charge of the admin of the case yourself (if you can). This will save you a lot of money.
Direct Access Barrister option
Alternatively, you could instruct a direct access Barrister. I find many people who follow this route do so because they usually get a set fee for the work (in some cases), they instruct us for. For example, I may get asked to draft a letter, read the papers, and advise on some peripheral issues in the case, for which the quote will be inclusive of all these tasks and usually a lot more. I may need to speak to the client 4 times and email them 10 times, but ultimately, they will pay one set fee without any fear of the bill going up or be scared to talk to me in case charges increase. However, only choose this option if you are confident, you can conduct the litigation (as in most of the admin associated to the case).
Some people are frightened to upset the apple cart so to say, when their Solicitor is making good progress in their case but overbilling at the same time. However, no matter how good they are. This is client money and if overbilling is taking place, it should be raised. Do not let it go unchallenged. One option is to keep a log and state to the Solicitor, that you have not had a chance to review the costs in detail and will do later if you plan to do this.
Reasons for this – the other side of the argument.
Various reasons have been presented by Solicitors when they have defended themselves at Tribunals, however in my view, one of these is of particular interest. In the Law Gazette, last year reported a trainee solicitor was overbilling and, in her defence,she said it was because of excessive working hours and unrealistic targets set upon her by her firm. She claimed anxiety drove her to do this and was not disciplined. Whilst this may be the case, that some firms impose high targets on the employee Solicitors, the client still has the right to challenge their bill, the targets of the firm should not be used as an excuse to overbill the client.
Always remember you are hiring a service. You have the right to challenge the costs you are being asked to pay for. If any of the scenarios arise above, step in and query the charges or why so many lawyers need to be involved. Remember it is your right. If you would like any professional to advise on this subject, my contact details are below.