Contingent fees are appealing in part because many lawyers believe that charging a percentage of the client’s recovery frees them from tracking time.  True: you are not rendering a detailed hourly billing each month to your client.  But before you brush aside the necessity of tracking your time entirely, please consider the following:

Defending Your Fee

1.  If the client challenges your fee as excessive under Oregon RPC 1.5, tracked time will prove the effort you have put into the case.

2.  If the client fires you and hires someone else, you are entitled to a portion of the settlement or judgment collected by the new firm.  With time records, it will be much easier to apportion fees.

3.  If a lawyer in the firm leaves your office, taking a contingent fee client, tracked time will help resolve the fee allocation between you and the departing lawyer.

Fee Recovery

4.  If there is any chance of recovering fees – either by statute, under the terms of an arbitration, or in the form of an enhanced prevailing party fee – the court or arbitrator will want a detailed breakdown of time spent, not bulk billing or reconstructed time. Reconstructing your time and presenting it to the court or arbitrator as if it was contemporaneously recorded could be construed as a violation of Oregon RPCs 8.4(a) 3 and 4 and possibly 3.3.  Bulk-billed time could be used to “hide” activities that aren’t recoverable.  Fees submitted via a sworn Affidavit and should be accurate, detailed, honest, and complete.

Law Firm Economics

5.  Tracking time allows you to better gauge which areas of contingent work are more profitable.

Building Good Habits

6.  Most contingent lawyers do a mixture of work – some of what they do is hourly or at least eligible for fee recovery or enhanced prevailing fees as described above.  In this instance, it makes good sense to form the habit of tracking all time spent.  Otherwise, lawyers and staff must go through the mental exercise of trying to remember when they have to track time and when they do not. Time tracked without exception is more efficient because no time is wasted speculating whether to write an activity down.

All Rights Reserved [2014] Beverly Michaelis