Canadian Lawyer

W fuelling the law firm engine. This has particularly been the case in recent years, with individual clients and major corporations aiming to prudently navigate volatile economic times. Yet for the second year running, most of the nearly 600 law- yers who weighed in on Canadian Lawyer's Legal Fees Survey have indicated plans to raise fees. Fifty-two per cent of this year's hat to charge? It's a question that vexes lawyers and law firms every year when the talk turns to the bottom line. It can be a guessing game at best to find the right balance between affordable rates that meet clients' expec- tations and making enough money to pay the rising cost of petitors, or sympathy for clients in a tough economy. Local and regional situations also played a role. "Imposition of the HST in 2010 and the economic downturn made it hard on people, commented one Ontario lawyer. "Competitors haven't raised their fees. If anything, competition is more intense. " respondent said, "I think that our fees are within what the market will allow — any increase would likely be detrimental to our business. However, our overhead, etc., would not bear any decrease. " Another respondents said they plan to raise fees in the year ahead, while a mere one per cent plan to hold steady at the same rates they offered in 2011. Clearly things aren't all that bad. Hourly rates appear to be on the rise across the board. On a keep rates steady, many continue to seek creative ways to meet cli- ent needs. Contingencies, fixed fees, tariff rates for large-volume clients, flat fees, and performance caps are just some of the inno- vative billing strategies firms are now embracing. Of course many of these offerings are dependent upon the work. "I personally will accept substantial discounts if project is unusual and interesting, wrote one enterprising lawyer. While many lawyers are finding it impossible to reduce or " " nationwide basis, 10-year calls will charge an average of $408/hr in 2012, up sharply from $326 in 2011. Five-year calls expect to bring in $283/hr compared to the $260 they indicated they would charge in 2011. One-year calls are expected to charge $33 more per hour this year, with average hourly rates up at $229 in 2012 compared to $196 the year prior. This year' for 20-year calls and 20+ year calls, who plan to charge an average of $408 and $414 per hour, respectively. Based on reader feedback, this year' s survey begins tracking hourly rates to track 30 fees charged in eight areas of legal practice, including civil litigation, corporate-commercial, criminal, family, immigra- tion, intellectual property, real estate, and wills and estates. Results are again divided by region, with 52 per cent of respondents reporting that their firm has an office in Ontario, 44 per cent with an office in Western Canada (British Columbia, Alberta, Saskatchewan, Manitoba, and the North), and 14 per cent report- ing offices in Quebec or Atlantic Canada. Lawyers from a variety of firm sizes also participated in the survey. Forty-five per cent of those who completed the survey were from firms with 1 to 4 lawyers, 31 per cent from firms of 5 to 25 lawyers, and 24 per cent from firms made up of 25 or more lawyers. While most lawyers indicated plans to raise rates in 2012, s survey has been expanded only marginal rises are anticipated. Just over half of those who plan to increase fees will do so by up to five per cent, while 32 per cent will raise their rates by five to 10 per cent. Only one in 10 will hike fees by 10 to 20 per cent with a mere three per cent of respondents ushering in a sharp fee increase of 20 per cent or more this year. Rising overhead costs, inflation, and increased complexity of files were all common themes for lawyers who indicated plans to raise rates. Those who are holding rates steady (47 per cent) often cited a desire to keep pace with com- "I personally will accept substantial discounts if project is unusual and interesting," comments one enterprising lawyer. are faced with when setting fees, perhaps best captured by the following comment: "For most individual clients (i.e. non-corpo- rate) it is very expensive to retain a lawyer for any reason, yet for lawyers we need high fees to meet our costs." While this is certain- ly true, most clients continue to recognize that top legal service can prove invaluable. "Lawyers are not only providing a service, they are, in some practice areas, insuring a result," explained one survey respondent. "The cost of their services reflects this to a certain extent and is separate from the actual 'work' done. " www.CANADIAN Lawyermag.com JUNE 2012 33 practice areas that are showing dwindling returns. Residential real estate was most often cited in that category, but solo and small-firm practitioners are loath to cut a practice area that brings in a steady stream of clients who may return for more lucrative matters. Legal aid work was, unsurprisingly, another target of disdain for many survey respondents. "Legal aid is becoming less and less profitable given the delays in payment and the increas- ing bureaucracy and regulations associated with trying to obtain discretionary increases," one lawyer commented, adding that the program "is really out of touch with the market and becoming a burden to that free market." Others admitted they now view legal aid work as a form of pro bono. Many lawyers expressed consternation with the choices they Other practitioners are being pushed to the brink in specific

• Cover