The Billable Hour (1 Viewer)

[Frigid]

Attack on tyranny of the billable hour

The "tyranny of the billable hour" should come to an end and lawyers be forced to provide comprehensive budget statements for their clients, a NSW Government committee looking into legal fees has urged.

Under the scheme, lawyers would no longer be able to dodge disclosure provisions in the Legal Profession Act on the basis that estimating a final cost would "not be reasonably practicable".

The report, which was commissioned in February 2003, has been with the Attorney-General, Bob Debus, for more than six weeks and is expected to go before cabinet early next month.

However, the NSW Law Society has already signalled its opposition to any system which forces further regulations on solicitors.

The panel has railed against the practice of firms signing up clients to cost agreements that refer only to the hourly rate plus "costs and disbursements".

If the recommendation is adopted, the budget statements will also have to estimate how much the work would cost, require firms to inform a client of any cost blowout and state when payments should be made.

Such an agreement would form the basis of any challenge to a legal bill in the NSW Supreme Court.

It was criticism of time-based costing by the Chief Justice of NSW, Jim Spigelman, that led to Mr Debus setting up the panel comprised of Gordon Salier, of the Law Society, Ian Harrison, SC, of the Bar Association, the director-general of the Attorney-General's Department, Laurie Glanfield, and the Legal Services Commissioner, Steve Mark.

The Chief Justice asked whether billing by the hour was rewarding inefficiency and said he approved of Mr Salier's citing "the tyranny of the billable hour".

"A handful of members of the profession exploit their position by providing services that either do not need to be provided at all, or provide them in a more luxurious manner than is appropriate," Chief Justice Spigelman said.

Of the 2500-odd complaints received by the Legal Services Commissioner each year, about one in five involves legal fees.

Those settled in the client's favour included a solicitor who charged for 27 hours' work in one day and a senior lawyer carrying out photocopying duties at $600 an hour.

Mr Debus said yesterday the Government's priority with costs regimes and cost disclosure "will always be to ensure the rights of consumers". "That's why we asked for the report to be prepared," he said.

A Law Society councillor, Pauline Wright, said cost was a matter that should be left to the solicitor and the client.

She said it was often "very, very difficult" to provide an accurate quote. "It does place unreasonable demands because litigation is inherently unpredictable," she said.

Ms Wright even raised the spectre of fees rising.

"It may backfire. If we are forced into providing quotes we have to work out what is reasonable compared to our overheads. It may be that some would end up being quoted more than if it was based on an hourly rate."

An adviser to larger firms, Alan Cameron, said many corporate clients wanted a best estimate and did not want to be bogged down with detail.

The present regime does not demand detailed disclosure to large companies and government departments and any move for further detail is likely to be confined to smaller "consumers" of legal services who are not so streetwise when it comes to legal issues.

what do you think? why shouldn't lawyers charge on time, like other service personnel?

 

[charlie_charlie]

i don't agree with the idea of a predetermined lump sum - i think they should charge on an hourly rate, but there should be some greater explanation of fees to their clients than "photocopying services". the rationale behind the idea of having a lump sum makes sense, even if it is somewhat impractical because it is true that you won't be able to accurately guess exactly how much effort and time goes into a particular case. but even if it is unreliable to guess the cost, lawyers should be able to provide a quote a figure which is approximately what the fee would finish up as.

i personally think they should keep the billing system similar to what it is now, but have greater explanation for the time and have up front quotes as to the cost which are agreed to be an "estimate" by both the lawyer and the client. the system is a bit screwed up imo if one can charge $600 for photocopying! imagine if you Frigid, was able to charge that for an hour's worth of work. ... instead of award wage.

 

[Frigid]

the system is a bit screwed up imo if one can charge $600 for photocopying! imagine if you Frigid, was able to charge that for an hour's worth of work. ... instead of award wage.

if i billed $600/h as opposed to the $100/h i bill currently, i would demand a higher than award wage.

 

[MoonlightSonata]

Those settled in the client's favour included a solicitor who charged for 27 hours' work in one day and a senior lawyer carrying out photocopying duties at $600 an hour.

bahahaha


I'm not particularly in favour of the scheme though. I'm all for fairer, less expensive and more accessible legal services, but surely it would be too hard to provide such estimates?

 

[MiuMiu]

I very much believe in doing everything to maximise an individual's access to professional help when dealing with the legal system....part of this is being completely transparent and upfront about what its going to cost persons seeking to use the service you (or your company collectively) are providing.

Obviously in the case of court proceedings it is not always possible to put an exact timeframe on the length of your services from start to finish, but perhaps an initial estimation of the length of a proceedings (including pre-trial work) should be used to give cost, with provisions in a contract for fees per day if the proceedings go longer?

I don't know, I just don't think charging by the hour is a particularly fair way to be doing it. Sure, it can be fruitful for the lawyer, but few other white collar workers are paid by the hour (save for casuals and whatnot), I don't see how lawyers are really any different.

 

[santaslayer]

I'd say quotes should be reasonably estimated. ie. on average, how much time should a particular instruction by the client take? there will always be some discreprencies with estimates, as long as it isnt overboard. prices can be amended at the end to cver the extra cost. (or give a sum back for overestimate )

 

[melsc]

Perhaps they should just make a computer program to spit out quotes lol factor in experience, amount of time require for preparation etc... Still its hard to determine how long a case will go for and if problems will be encountered.