Canadian Lawyer

18 A p r i l 2 0 1 4 w w w . C A N A D I A N L a w y e r m a g . c o m by Danielle olofSSon tECh support The value scramble l ast December, I was invited to lead a roundtable discus- sion on what external legal services clients will pay for and what they will not. I represented Big Law. The other 10 or so members of the discussion were legal counsel for businesses and companies in Montreal. As I attempted to organize my thoughts and responses to the points that were raised, I was surprised by the level of discomfort in the room and by the fundamentally awkward relationship that seems to exist between in-house and outside counsel with respect to billing. For example, one of the admissions by in-house counsel that initially sur- prised me was the amount of time they spent reviewing bills from law firms. Although I wondered what value they could possibly add to their employers by scrutinizing invoices rather than attend- ing to legal matters, when these counsel listed the items they found offensive — from billing much more than was agreed, to receiving an invoice before the work they had ordered was completed and delivered — I soon understood the scrutiny, not to mention its value. Another practice we discussed, a personal pet peeve, is the request for a fixed fee accompanied by a shadow invoice. This request always strikes me as profoundly inconsistent. If both par- ties agree to a price, why should one be obliged to perform the additional chore of itemizing the time it spent working on a matter? The above examples are revealing of a relationship gone awry. Many clients don't trust their legal service providers — sometimes with reason — and many law firms are tired of clients' haggling and nitpicking. On the clients' side, the roots of this mistrust are varied. Some clients simply want the budgets they have provided their lawyers to be respected. Others have a more visceral reaction to the law firms they engage. These clients are frequently represented by lawyers who left Big Law either because they were asked or because they did not agree with the way it was practised. In both cases, they have seen the waste that went on in firms and are adamant, now that they are responsible for their company's legal spend, they are going to receive value. The difficulty with "value" is, like many concepts, it means different things to different clients. Whereas a junior in-house counsel may find value in an external lawyer who is not an expensive expert but is always available to provide good strategic and general advice, a seasoned general counsel may instead value a direct line to an expert who can answer a specific question quickly over the phone. At this level, money is no object. The only, and equally vague, definition of value that seemingly can be agreed to is "receiving the desired result at the desired price." This desired price, however, is at the root of the malaise between clients and their law firms. It is not simply a question of replacing the billable hour with whatever fee structure happens to be the flavour of the month. It is rather a question of ensuring what a client receives in exchange for what they pay is justified. In other words is the client being charged a fair price? The answer to this question continues

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