32 N O V E M B E R / D E C E M B E R 2 0 1 6 w w w . C A N A D I A N L a w y e r m a g . c o m
Fee discussions
shift from AFAs
to value
The Annual Canadian Lawyer Corporate Counsel
Survey found the use of AFAs has declined from
last year, but experimentation continues
A
s in-house counsel
continue to experi-
ment with alternative
fee arrangements,
there has been a shift
toward looking more
at overall value —
whatever fee arrangement is ultimately
used.
This year, 4.9 per cent of respon-
dents to the Canadian Lawyer Cor-
porate Counsel Survey said they use
alternative fee arrangements with their
primary law firm. Last year, the num-
ber was 12.7 per cent.
Stephen Rotstein, chairman of the
Canadian Corporate Counsel Associa-
tion, doesn't think the whole idea of
AFAs — whether you're looking at
alternative or appropriate fee arrange-
ments — is going away, but he does
see it as going through a transition.
Because of the cost certainty and pre-
dictability in-house counsel are looking
for, they're always going to be receptive
to new ideas.
"For too long, we've looked at the
value lawyers bring to an arrangement
just by the amount of hours they put in
and that's not the value they bring to
corporate clients," he says. "It's not the
hours you bill but the value you pro-
vide. There's got to be better ways."
Lorne O'Reilly, senior counsel
at Dow Chemical Canada ULC in
Alberta, suggests the drop in reported
usage may come down to what people
are reporting as an AFA, a factor of
familiarity of what's out there or simply
the fact that AFAs have been tried, but
in a number of circumstances the tra-
ditional hourly billing rate provides the
best value.
He also wonders whether in-house
counsel are nervous about losing their
By Mallory Hendry
