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  • Writer's pictureBridget Lontok

What is a disbursement anyway? Bills, bills, bills!

Updated: Aug 1, 2022

Legal invoices can be confusing. The word "disbursement" isn't used a lot outside the legal world. Some people are embarrassed to ask what it means; don't be. It wasn't that long ago that I didn't know what a disbursement was either.

A disbursement is an expense that your paralegal incurs in order to represent you. It is something that a client can be charged for on top of hourly fees, or block rates and flat fees. The paralegal pays the expense first and then the paralegal is reimbursed for the expense by charging you for the expense on your monthly bill (or however often you are billed). Paralegals and lawyers are not allowed to profit off disbursements, they can only recover expenses.

I know, not the best explanation. Let me try an couple examples.

You are suing someone because you were injured in a slip and fall. You have to get a report from your doctor to prove your allegations. Doctors charge money for these reports. Your doctor wants to charge $500 for the report. You gave your paralegal the go ahead to pay for and order the report.

Your paralegal will order and pay the $500 for the report. On your next bill your paralegal will charge you $500 for the report so that they are reimbursed for the expense. Remember, your paralegal is not allowed to profit off of disbursements.

If you are paying an hourly rate then you will also be charged for the time it takes to prepare an authorization for the report, write to the doctor to request the report, and then review the finished report. I know that this sounds overwhelming.

Let's try another example.

You need a witness to testify at your hearing. Your paralegal recommends that you summon the witness so that you can be sure that your witness doesn't back out at the last minute or so that your witness can get the day off work. When you summons a witness you have to pay them an attendance fee. The fee is calculated based on what the law for your matter says. In this example we will just say $53. The summons needs to be served on the witness and that costs money too, lets say $50. Your paralegal will pay the witness' attendance money and pay the process server. On your next bill, the paralegal will then charge you $53 for the summons and $50 so they can recover the expense. Remember that your paralegal cannot profit off disbursements, but if you are paying your paralegal an hourly rate then your paralegal will charge you for the time it takes to prepare the summons and retain the process server.

Some other examples of disbursements are:

  • Long distance charges

  • photocopying

  • expert reports

  • travel expenses

  • court filing fees

  • and many other possibilities.

Depending on your situation there could be many disbursements or few.

Why am I writing about disbursements and billing?

Because I understand that people worry about money. Not understanding the costs of your legal matter can cause a lot of stress. It is often the reason people do not retain a paralegal or lawyer. If you don't understand why or what you are being charged for, then you might not trust your paralegal. Trust is essential to a good paralegal-client relationship.

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