I tend to see alternative billing as an economic issue with business, financial and marketing consequences. I also see very clearly the role alternative billing must play in any consideration of applying technology to the practice of law. In fact, the area that I call "client-driven technology" requires a consideration of alternative billing. The largest push for alternative billing definitely comes from clients. And, in some areas of practice, such as estate planning, alternative billing methods have resulted from the pricing practices of non-lawyer competitors for services closely related to traditional legal services.
In short, alternative billing is one of the key areas where you see innovation by lawyers. I like innovation.
However, as I am reminded from time to time, the legal profession is not known for innovation and a substantial number of lawyers, law professors and other legal professionals are extremely wary of change in the profession. In some cases, this inherent conservatism serves extremely useful purposes. In other areas, it can make you scratch your head in wonder.
After last month's column, I was reminded that some lawyers and law professors believe that alternative billing in and of itself raises perhaps insurmountable ethical issues. This position may come as a surprise to those who worry about the incentives hourly billing minimums give to lawyers and firms to condone, look away from or even promote the "padding" of hours and other practices often in the news these days. Others in the legal profession see alternative billing as an attack on the very core values of the legal profession.
All of this can be quite confusing, for lawyers and clients alike. It's an odd world where an attorney might be characterized as unethical for making a client happy with a flat-fee $750 customized estate plan created with a document assembly tool and another attorney who spends a few hours settling a million-dollar case for a 40% contingent fee falls well within the bounds of "ethical."
In this month's Strongest Links column, therefore, I've decided to supplement last month's column by highlighting some Internet resources that make sense for those who wish to delve into the many different aspects of hourly billing.
The Basic Bibliography
The ABA's Ad Hoc Committee on Billable Hours Online Bibliography - http://www.abanet.org/careercounsel/billable/toolkit/bib.html. The widely-praised efforts of this committee are exemplified by this useful bibliography, which offers an unparalleled starting point for learning about alternative billing issues.
Real World Data and Real World Comments from the Trenches
Report of The Missouri Bar Alternative Billing Methods Committee - http://members.mobar.org/billablehours/ABMC_Report.htm. I'm a member of the Missouri Bar, but I played no role in this comprehensive report based on a survey of Missouri lawyers. I may be a little biased, but this report is an impressive piece of work, filled will important facts, observations and discussion, including an Appendix listing applicable ethics opinions.
Real World Discussions
The Wisconsin Law Journal Roundtable Discussion - http://www.wislawjournal.com/archive/2003/0108/roundtable-1.html. Tony Anderson's two-part roundtable discussion with representatives of six law practices, ranging from solo practitioners to the managing partner of a firm with more than 175 attorneys, is a great place to get a feel for the non-theoretical world of lawyer billing.
Researching Ethical Issues
Legalethics.com – http://www.legalethics.com and FindLaw – http://www.findlaw.com/01topics/14ethics/index.html. Relying on a general Internet search engine to find articles and resources on legal ethics is likely to leave you marveling at all the unusual items that turn up as search results. These matters are widely scattered and surprisingly difficult to find on the Internet. You tend to get glimpses here and there, rather than any sense that you are finding more than a fraction of what is available. Instead, turn to LegalEthics.com, for many years the standard resource on legal ethics, or the legal search tool FindLaw.
Show Me the Forms
North Carolina Bar Association's Collection of Billing Forms - http://www.ncbar.org/about/commissionstaskforce/alternatebilling.aspx. Lawyers love forms they can use as models. The North Carolina Bar Association's Alternate Billing Commission has put together a collection of billing forms based on approximately 150 engagement letters submitted by North Carolina lawyers.
Flipping the Question – Focusing on the Per-Partner Revenue Question
Bruce Marcus, Anticipating Future Shock - http://www.marcusletter.com/Billing%20structure.htm. I like the idea of looking at the same issue from a different observation point. Marcus's article reverses the equation by focusing on the issue of per-partner revenues. This short, concise article casts a new light on the subject by changing the normal assumptions.
Client-Driven Technology
Client-driven Technology Resources, http://www.denniskennedy.com/resources/legal-tech-central/clientdriven.aspx. I've been thinking, writing and speaking about the interplay of technology, client needs, client service and the pricing of services provided by means of technology for several years. On this page, I collect useful resources that I find on this subject.
The Thoughts of a Sage
Arthur Greene, "Thinking Outside the
Box: Leave the billable-hours factories behind"
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http://www.abanet.org/buslaw/blt/2004-05-06/greene.shtml.
I don't think that I'd find much objection if I simply
stated that Art Greene is the most respected individual
involved in law practice management issues. In this
recent article, Art takes a reflective look at the
practice of law and the billable hours system. I wouldn't
consider you a serious student of the issue if you
did not read and reflect upon this article.
While the rallying cry of supporters of alternative
billing might well be "Abraham Lincoln didn't
bill by the hour," it is important to recognize
the diverse and even contentious views about alternative
billing that exist today. The discussion about alternative
billing is a discussion that the legal profession
must have, as former ABA President Robert Hirshon
wisely saw. Currently billing practices have enormous
implications for clients, lawyers, the culture of
firms and the economic viability of the current methods
of practicing law. Law Practice Today's two-part
alternative billing issues is intended to play a key
role in keeping this discussion alive and flowing.