ABA Billing Guidelines: Model Rules for Legal Fees

ABA Model Rule 1.5 sets the standard for attorney fees and billing practices. Every state has adopted some version of this rule. Violate it and you face disciplinary action, fee disputes, or malpractice claims. This guide covers the specific requirements, the eight factors for determining reasonable fees, and the billing practices that get attorneys in trouble.

What Are ABA Billing Guidelines?

The American Bar Association's Model Rules of Professional Conduct govern attorney billing through Rule 1.5. These rules define what constitutes a reasonable fee, require fee communication to clients, and prohibit specific billing practices.

State bars have adopted these rules with variations. Some states have stricter requirements. Check your jurisdiction's specific rules, but the ABA Model Rules provide the baseline.

ABA Model Rule 1.5: The Core Requirements

Fee Reasonableness

Rule 1.5(a) prohibits fees that are unreasonable. The rule lists eight factors to determine reasonableness:

1. Time and labor required, the novelty and difficulty of the questions involved, and the skill requisite to perform the legal service properly
2. Likelihood that the employment will preclude other work by the lawyer
3. Fee customarily charged in the locality for similar legal services
4. Amount involved and results obtained
5. Time limitations imposed by the client or circumstances
6. Nature and length of the professional relationship with the client
7. Experience, reputation, and ability of the lawyer(s) performing the services
8. Whether the fee is fixed or contingent

These factors matter when clients dispute bills or file bar complaints. Document your reasoning for significant fees.

Fee Communication Requirements

Rule 1.5(b) requires communicating the scope of representation and the basis or rate of the fee to the client, preferably in writing, before or within a reasonable time after commencing the representation.

Your engagement letter should specify:

• Hourly rates for each timekeeper
• Billing increments (typically 6 minutes or one-tenth of an hour)
• What expenses are billed separately
• Retainer requirements
• Payment terms and deadlines
• Consequences of non-payment

Changes to fees during representation require communication and explanation. The ABA has confirmed that fee agreements can anticipate future rate increases, but any change must be timely communicated to the client.

Contingent Fee Requirements

Rule 1.5(c) requires contingent fee agreements to be in writing, signed by the client, and state:

• The method for determining the fee
• Percentage(s) that accrue to the lawyer
• Expenses deducted before or after calculation
• Whether expenses are deducted before or after the contingency percentage

Contingent fees are prohibited in domestic relations matters (with exceptions) and criminal cases under Rule 1.5(d).

Fee Splitting

Rule 1.5(e) governs fee division between lawyers not in the same firm. Division is permitted only if:

• The total fee is reasonable
• The client agrees to the arrangement in writing
• The arrangement includes the share each lawyer receives or lawyers assume joint responsibility

Prohibited Billing Practices

The Model Rules, combined with ethics opinions and case law, prohibit specific billing behaviors.

Double Billing

Billing multiple clients for the same work is prohibited. If you research an issue for Client A and use that research for Client B, you cannot bill both clients full price for the same work.

Example: You spend 3 hours researching contract termination clauses for Client A. Client B has a similar issue. You can bill Client A the full 3 hours. For Client B, you bill only the additional time needed to apply that research to their specific situation.

Block Billing

Block billing combines multiple tasks into a single time entry without breaking down the time spent on each. While not explicitly prohibited, courts and bar associations disfavor it.

Bad: "Review documents, research motion issues, draft brief - 6.0 hours"

Better:

• "Review contract and exhibits for summary judgment motion - 1.5 hours"
• "Research enforceability of non-compete provisions in CA - 2.0 hours"
• "Draft statement of facts section of motion - 2.5 hours"

Block billing invites fee disputes and makes it difficult to defend charges.

Billing Attorney Rates for Non-Attorney Work

Administrative tasks performed by attorneys should not be billed at attorney rates. This includes:

• Filing documents
• Scheduling depositions
• Copying and organizing documents
• Basic document review that a paralegal could perform

Some tasks are judgment calls. Document review requiring legal analysis differs from document sorting.

Padding Hours

Billing more time than actually worked violates Rule 8.4 (conduct involving dishonesty, fraud, deceit, or misrepresentation). This includes:

• Rounding up excessively
• Billing for time not spent on the matter
• Inflating hours to meet targets

The rule is simple: bill the time you actually spent.

Overbilling Travel Time

Travel billing varies by jurisdiction and agreement. Common approaches:

• Bill actual travel time at reduced rates (50-75%)
• Bill portal-to-portal for out-of-town travel
• Work performed during travel billed at full rates

Your engagement letter should specify how travel is handled.

Billing Description Best Practices

Detailed descriptions protect you and inform your client.

What to Include

• Specific task performed
• Purpose of the task
• Names of parties involved (for calls and meetings)
• Documents referenced (by name or type)

Examples

Weak descriptions (invite disputes):

• "Research"
• "Review documents"
• "Client call"
• "Draft correspondence"

Strong descriptions (defensible):

• "Research California law on covenant not to compete enforceability in employment context"
• "Review and analyze contract exhibits A through D for indemnification obligations"
• "Call with client J. Smith regarding settlement offer terms and response strategy"
• "Draft letter to opposing counsel responding to discovery extension request"

Standard Billing Increments

Most attorneys bill in six-minute increments (one-tenth of an hour). This is the standard practice recommended by the ABA.

Some firms use quarter-hour (15-minute) billing, which typically rounds up in the firm's favor. While legal, this practice increases the risk of client disputes on small tasks.

Common Compliance Mistakes

Not Getting Fee Agreements in Writing

Rule 1.5(b) says fees should be communicated "preferably in writing." While oral agreements are sometimes permissible, they create disputes. Always get engagement letters signed.

Failing to Update Clients on Costs

Large or unexpected charges should be communicated before they appear on an invoice. Clients who learn about a $50,000 research project from the bill become former clients who file bar complaints.

Inconsistent Billing Practices

Using different standards for different clients, or different standards on the same matter, undermines defensibility. Establish firm-wide billing guidelines and follow them.

Missing the Window for Fee Modifications

Fee increases during representation must be communicated in advance. Surprising clients with higher rates after work is performed invites disputes.

Enforcement and Consequences

Billing violations result in:

Bar discipline: Suspension, disbarment, or public censure depending on severity and pattern Fee disgorgement: Courts can order return of fees found unreasonable Malpractice claims: Billing fraud is actionable Criminal prosecution: Extreme cases involving fraud Reputation damage: Public discipline records affect client development

Frequently Asked Questions

Can I bill for reading this article?

If you read it to improve your practice generally, no. If you read it to address a specific client billing issue, arguably yes, but use judgment on reasonableness.

How detailed do my billing descriptions need to be?

Detailed enough to defend in a fee dispute. If a judge or bar investigator reviewed the entry, could they understand what you did and why it was necessary?

Can I charge different rates to different clients?

Yes, as long as all rates are reasonable and disclosed. Premium rates for rush work or specialized expertise are acceptable if communicated.

What if my state rules differ from the ABA Model Rules?

Your state rules control. The ABA Model Rules are templates that states modify. Check your jurisdiction's specific requirements.

Is minimum billing ethical?

Minimum billing (e.g., 0.2 hours minimum for any task) is common but controversial. It is generally permissible if disclosed in the engagement letter, but excessive minimums invite scrutiny.

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Related Resources:

• UTBMS Codes: Complete Legal Billing Code Reference - Standardized billing codes for e-billing compliance
• How to Track Billable Hours Effectively - Best practices for time capture
• Best Clio Alternatives for Law Firms - Practice management and billing software options