Importance

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Abstract

A method and system is disclosed including storing data regarding a plurality of law firm clients in a database, designating at least some of those clients to be billed for interest incurred financing out-of-pocket expenses, with the law firm financing an out-of-pocket expense using law firm capital or a loan from a financing source. The law firm bills a client for a particular financed out-of-pocket expenses, and determines a cost recovery fee associated with the financed out-of-pocket expense, wherein the cost recover fee is calculated or checked based on one or more criteria to help the law firm avoid charging a client more than a threshold rate. The method and system further provides that the law firm bill the client for at least a portion of the cost recovery fee as a disbursement at the same time as billing the client for the associated out-of-pocket expense, and that the client pays the law firm for the financed out-of-pocket expense and for the cost recovery fee disbursed to the client. It is further determined, using the accounting system, how long the out-of-pocket expense was financed for based on when the law firm was paid by the client and when the out-of-pocket expense was incurred, and determining an actual interest rate charged by the law firm as a result of financing the out-of-pocket cost for the client. Further the method and system provide that the law firm credit or refund to the client for any portion of the cost recovery fee charge that results in the rate exceeding the threshold rate. The threshold rate may be a usurious rate.

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First Claim