In-House Counsel

The claimed value to general counsel of predictable legal expenses on matters

By Rees Morrison

For years people have told me that general counsel strongly value predictability of legal fees, even if that means higher fees. I have doubted that statement. I doubt it because the total amount spent during a year on outside firms is the measure, not whether the law department hit its budget number pretty closely or smoothed out its monthly payments.

But perhaps I underrate the adverse consequences to a general counsel of coming in either much higher or much lower than budget. It throws off the calculations of the financial department.

Predictability is good; budgets have a purpose and take on a life of their own; and management of amounts spent outside is a game worth playing well (See my post of Nov. 17, 2006: survey finds that predictability favors alternative fee arrangements; Nov. 13, 2006: claim by Eversheds that clients demand predictability; and May 2, 2007: e-billing may enable more predictability.).

Full post as published by Law Department Management on May 24, 2009 (boomark / email).