ANALYSIS: Behind the times
By ALB
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Tuesday, 14 December 2010
Much has been written in recent times about the predicted demise of hourly billing – how in-house lawyers have stridently demanded a fresh approach to measuring value and how large commercial firms have allegedly ignored these calls and left themselves open to attack from smaller firms espousing innovative new fee structures. These are themes which have been presented as evidence of an irresistible shift in the way the profession views the question of billing.
But the latest survey of opinion in the in-house profession presents a problem for this theory. According to the 2010 Legal Department Benchmarking Report, a joint production of CLANZ, ACLA and consultancy firm Team Factors, 53% of Australian in-house lawyers were either satisfied with hourly billing or were “unconcerned” on this issue. Remarkably, the equivalent figure for New Zealand in-house lawyers was 70%.
In-house lawyers may not be entirely enamoured with hourly billing, but nor does there appear to be a clear consensus that the industry should move away from it. Admittedly, support for hourly billing in Australia has dropped since the last equivalent industry survey was completed in 2008, but support has risen in New Zealand in that period.
The difficulties and client frustrations relating to hourly billing have been well documented. However, it may be the case that the level of client angst about hourly billing has been somewhat exaggerated. One general counsel who has been bemused by the attention the issue has received is UBS GC Annette Spencer. “I’m curious about the focus on alternative billing arrangements,” she said. “It’s not a big issue for us. I don’t think we are struggling to keep on top of the estimates. We have not had any particularly nasty surprises as yet using hourly billing.”
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