Law Practice Mgmt Test 2

recurring entry

A calendar entry that recurs.

earned

A case retainer is an ______ retainer.

unearned

A cash advance retainer is an ________ retainer.

false

A contingency agreement can be used in all kinds of cases.

criminal fraud

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

flat fee

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

hourly rate fee

A fee for legal services that is billed to the client by the hour at an agreed upon rate.

case retainer

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.

pure retainer

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

calendaring

A generic term used to describe the function of recording appointments for any type of business.

docket control

A law-office-specific term that refers to entering, organizing, and controlling all the appointments, deadlines, and due dates for a legal organization.

value

A legal billing arrangement that is similar to the type used when you get your car fixed is called _____ billing.

case management

A legal term that usually refers to functions such as docket control, things to do, contact information by case, case notes, document assembly, document tracking by case, integrated billing, and e-mail.

settlement

A mutual agreement to resolve a dispute on specified terms.

prepaid legal service

A plan that can be purchased that entitles the person to receive legal services either free or at a greatly reduced price is called _______ _____ ________.

budget

A projected plan of income expenses for a set period of time, usually a year.

time sheet or time slip

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

aged accounts receivable report

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

timekeeper productivity report

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

case type productivity report

A report showing which types of cases are the most profitable.

earned

A retainer for general representation is an ______ retainer.

earned

A retainer that can be deposited in the firm's or attorney's operating checking account is called an ______ retainer.

prebilling report

A rough draft version of billings.

trust or escrow account

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

certificate of service

A statement at the end of a court document that certifies or establishes when a document was placed in the mail.

statute of limitations

A statute or law that sets a limit on the length of time a party has to file a suit.

value billing

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.

five

According to the model rules, an attorney must maintain client trust fund records for at least _______ years after a client's case is concluded.

billable time

Actual time that a paralegal or attorney appends working on a case and that is directly billed to a client's account.

realization

Amount a firm actually receives in income as opposed to the amount it bills.

True

An account where unearned client monies are deposited is called a trust account.

true

An attorney can put his or her own monies in the client trust account to cover bank service charges.

false

An attorney cannot commingle multiple client funds into one trust account.

blended hourly rate fee

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

Interest on Lawyers' Trust Account

An interest bearing account set up specifically to hold trust funds.

escrow account

Another name for a trust account is ___________ ___________.

personal information manager(PIM)

Consolidates a number of different tasks into one computer program. Most include calendaring, things to do, a contact database that tracks names and addresses of people, note taking, and other tasks as well.

staffing plan

Estimate of how many employees will be hired or funded by the firm, what positions or capacities they will serve in, what positions will need to be added, what old positions will be deleted, and how much compensation each employee will receive.

income budget

Estimate of how many partners, associates, legal assistants, and others will bill for their time, what the appropriate rates of hourly charge should be, and the number of billable hours each timekeeper will be responsible for billing.

client hourly rate

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.

attorney or paralegal hourly rate

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

activity hourly rate

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

contingency fee

Fee collected if the attorney successfully represents the client.

court-awarded fees

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

False

Flat fee agreement must be in writing.

fee disputes

For what activity do clients file the most ethical complaints against lawyers?

overhead

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

false

If a client signs a contract with an attorney and the fee turns out to be clearly excessive, it does not matter because a contract was signed and the contract prevails.

false

It is alright for an attorney to borrow monies from the client trust account as long as it is paid back within one day.

True

It is highly recommended that all fee arrangements be in writing.

pro bono

Legal services that are provided free of charge are called _______ work.

unearned retainer

Monies that are paid up front by the client as an advance against the attorney's future fees and expenses.

1. the amount of time and labor required. 2. the novelty or difficulty of the issues raised. 3. the skill required to perform the legal services 4. the acceptance of the case and whether it would preclude the attorney from taking other cases.

Name four of the eight factors that courts use to determine if a fee is unreasonable.

attorney or paralegal hourly rate, client hourly rate, blended hourly rate, activity hourly rate

Name four types of hourly rates:

send regular monthly billings, withdraw from cases as soon as possible once you know they will not pay

Name two strategies for collection on client accounts.

false

Paralegals can bill for time spent copying and other clerical duties.

true

Paralegals represent a profit center at most law firms (i.e. they bill more to clients that they are paid in salary and benefits).

legal malpractice

Possible consequence when an attorney's or law office's conduct falls below the standard skill, prudence, and diligence that an ordinary lawyer would possess or that is commonly available in the legal community.

zero-based budgeting

Procedure that forces everyone in the organization to justify and explain his or her budget figures in depth without using prior years' figures as justification.

internal control

Procedures that an organization establishes to set up checks and balances so that no individual in the organization has exclusive control over any part of the accounting system.

management reports

Reports used to help management analyze whether the office is operating in an efficient and effective manner.

continuance

Rescheduling an appointment or court date.

bates stamp

Stamps a document with a sequential number and then automatically advances to the next number.

calendar days

System for calculating deadlines that counts all days including weekends and holidays.

workdays

System for calculating deadlines that refers to only days when the court is open.

time-to-billing percentage

System of adjusting downward the actual amount that will be billed to clients during the budget process, taking into account the fact that timekeepers are not always able to bill at their optimum levels.

earned retainer

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.

outside counsel

Term referring to when corporate and government law practices contract with law offices to help them with legal matters.

leveraging

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

Billing

The process of issuing invoices for the purpose of collecting monies for legal services performed and being reimbursed for expenses.

billing

The process of issuing invoices for the purpose of collecting monies for legal services performed and being reimbursed for expenses.

Time Keeping

The process of tracking time for the purpose of billing clients.

timekeeping

The process of tracking time for the purpose of billing clients.

Cash flow

The regular flow of revenue or monies into the law office and expenditures or disbursements flowing out of the office.

nominal amount, held for a short amount of time

There are usually two restrictions on the kinds of client funds that can go into an IOLTA account. Only ____________ and _____________ can go into an IOLTA account.

general firm activities, personal time, pro bono work

Three types of nonbillable time

nonbillable time

Time that cannot be directly billed to a paying client.

cash advance

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

• Cut overhead expenses where possible • Limit the ordering of supplies • Bill more hours • Use practice management to select better cases which are more profitable

What are solutions to cash-flow problems in law offices?

• Failure to bill clients on a regular basis • Unhappy clients who do not pay their bills • Uneven flow of revenue into the office which could be caused by the type of cases the law firm handles • Unprofitable cases which do not bring revenue into the law office.

What are some reasons for cash-flow problems in law offices?

Give the client a final written statement

What must the attorney do at the end of a case where a contingency fee or an agreement was used?

1. clients notified of in writing regarding all activities in the trust account that affect their case. 2. trust account be reconciled and documented for verification.

What two things should an attorney do regarding a client trust account on at least a monthly basis?

contingency fee

When a lawyer takes a percentage of the recovery of the case, it is called a ___________ fee.

electronic billing

When law firms bill clients using electronic means, such an the Internet.

false

With an IOLTA account the interest monies are paid to the client.

internal control

________________ refers to procedures to set up checks and balances so no one individual has exclusive control of any part of an accounting system.

double billing

bill one client or the other/ do not bill two clients for same time/ possible bill the client with higher rate