A row over the future of the billable hour has erupted between two of the highest-profile law firm leaders in the US.
A row over the future of the billable hour has erupted between two of the highest-profile law firm leaders in the US.
Earlier this year Evan Chesler, chairman of Cravath Swaine & Moore, called for major changes to the way law firms bill their clients, saying: “The billable hour makes no sense, not even for lawyers” (23 February, Rev Counter).
Now Peter Kalis, Chesler’s opposite number at K&L Gates, has responded. Kalis was one of a group of managing partners quizzed last week by The Lawyer for an upcoming article on whether the current economic downturn represented a paradigm shift for the world’s leading firms. In response to a number of questions on this topic, Kalis took a shot clearly aimed at Chesler.
“The paradigm shift has a number of key implications for our industry,” Kalis argued. “Enlightened law firms for years have been offering alternative fee arrangements to clients. To hear a leader of a Wall Street firm recently issue a clarion call for alternative fees was amusing.
In response, Chesler called the comments “unfair” and said he had been talking about alternatives to the billable hour since before the economy declined.
“Generally what clients want is more of what they’ve wanted for some time,” Chesler added. “That is, to control their costs, including the cost of their outside legal services, and to match those costs against the value they receive.
“This is a facile comment by somebody who is not well informed.”
The full-length feature, which will include a broader discussion of this topic, will appear in the 30 March issue of The Lawyer.
Justin Timberlake said it best
Further to my post at 14:29 on 19/03, it could also be argued that many students in their final year who have not submitted applications by now are perhaps those who are/were sitting on the fence when deciding whether or not to pursue law as a career. Whilst this isn’t in itself bad – indeed, some people take longer to decide their career path than others – I don’t think the current climate caters for such indecisiveness.
This time-frame favours those applicants who spend the summer before their final year researching firms and working out what sort of law they wished to pursue. Whilst final year students have always been able to apply up until the late July deadlines, I never understood how any fully committed, bright applicant would leave it so late.
Chesler talks the talk
Two points: (i) the article does not concern the relative merits of law and non-law students in the practice of law. It is simply a procedural situation brought on by the prohibition on offering second year students a TC before September. If you take anything from it it should be that non-law applications are way up. Perhaps City redundancies and dropping retention rates have not been reported in Modern Languages Monthly or The Geography Journal; (ii) Regarding the relative merits of law and non-law students, law students (at Oxbridge at least) undertake the most work intensive degree under the supervision of the undisputed world experts in the subject (English law). Non-law students go to BPP. (Test: go and ask a non-law student to explain the corporate veil, Clayton’s Case, subrogation, renvoi etc etc.)
They seem to agree, actually
If Slaughters want to miss out on some of the best and brightest trainees, they are going about it the right way. (I’m a non-law gradute, so I may be a little biased)
Fees
For those taking such extraordinary aggressive views to this article, it may well be worth reading the article again as it has clearly been misread or misunderstood. Attention to detail is clearly a key skill that needs to be honed for some.