Canadian Lawyer

there was more work to be done. However 11.8 per cent indicated their departments had shrunk and 8.3 per cent noted growth meant they had filled positions that were left vacant. As in past years, aware- ness and concern over costs was the No. 1 area corporate counsel identified where firms can improve their working relationships with in-house legal departments at 46.6 per cent, followed by "be more practical" at 30.4 per cent and "be more con- cerned with results" at 35.1 per cent. However, as much as packaging how law firms charge for their services, Borbridge says it' firms will assist in managing costs rather than reducing them. "There might be ways to monitor the legal cost more accurately so that they might say, 'hold on, lets not proceed on this portion until we know we absolutely have to, ' and that makes sense to me. I think that's something law firms can provide but I don't think we're necessar- ily seeing a big change away from billable hours." Chisholm opines that few the majority of in-house counsel indicated they want to pursue alternative billing arrangements and get more value, most said they still default to hourly billing — 55.4 per cent said the billing arrangement they have with their primary law firm is based on billable hours (up from 50.5 per cent last year) while 35.7 per cent is based on a combination of billable hours plus flat fees (down from 42.9 per cent last year). Just 6.7 per cent said they had alternative arrangements, the same as last year. Some survey respondents indicated they are negotiating various forms of discounts with their firms. "It doesn't surprise me because it's the easiest," says Borbridge of the number using billable hours. "It' ple, everybody knows how it works, and I'm not sure we can reasonably expect that law firms are going to put together arrangements that will reduce their revenue over time. They might find ways to do more work for us for the same amount but it' not in their interest to reduce their own revenue. s When it comes to re- " s sim- s more likely ARE YOU SATISFIED WITH YOUR CURRENT BILLING ARRANGEMENT? Yes No We are corporate clients are paying rack rate anymore but she questions whether discounts are really discounts at the end of the day. "They may be paying a billable hour and we can go back and forth over the utility of a discounted billable hour — a lot of people including myself have some cynicism in that regard. I think if you get a 15-per- cent discount sometimes lawyers are at least encour- aged by their business model to charge 15-per-cent more hours to a file. increase in the use of flat fees applied to parts of a litigation file; for example, if enough is known about the file to know how many witnesses are going to have to be examined for discovery. Quite often exchange of pleadings can also be charged by flat fee. Ultimately, it' She does see a significant " HAS YOUR TOP LAW FIRM ASKED YOUR LAW DEPARTMENT TO COMPLETE A WRITTEN, PHONE, OR IN-PERSON SATISFACTION SURVEY IN THE LAST 12 MONTHS? billing/relationship model that needs to be addressed, she says. "Inevitably where the business model wants to take us is that there is some risk shared by the client and the external firm because as long as the external firms continue to bill by the hour and reward their lawyers for the number of hours billed, those external lawyers are s the entire 81.6% NO currently reviewing Other ARE YOU ASKING THE LAW FIRMS YOU DO BUSINESS WITH TO PROVIDE A DIVERSE ROSTER OF LAWYERS AS PART OF AN OVERALL DIVERSITY STRATEGY IN YOUR ORGANIZATION? WE'RE THINKING ABOUT IT 5.3% 5.3% 7.8% YES, WRITTEN YES, OVER THE PHONE YES, IN-PERSON w w w . CANADIAN Lawyermag.com N O VEMBER / D ECEMBER 2012 37 No 70.9% 50% 17.4% 29.4.7% 3.2% 11.2% Yes 18%

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