Corporate counsel told to get tough on firm over-charging

IN-HOUSE lawyers must get tough with private practice over the way they prepare their bills, delegates at

the Company Lawyers Conference in Madrid were warned.

The vice-president and general counsel of GE Medical Services – a subsidiary of General Electric – told the conference his company was no longer prepared to accept large legal bills without detailed explanations.

“If someone sends me a bill where not every item is itemised, then we don't pay it,” Jean-Claude Najor said.

“I was recently sent a bill where the sender, a well-known law firm, had billed me for the time spent preparing the bill. It was sent straight back.”

GE Medical insists on negotiating fees prior to the firm starting work, as well as signing non-negotiable terms of retention forms for major deals.

“We have forms that are a decomposition of every stage in a deal, which we get our outside counsel to complete in great detail.

“We have firms who say to us: 'We can't sign this', but I say: 'Fine, we'll get someone else'.”

However, Fernando Pombo, senior partner at Spanish firm Gomez-Acebo & Pombo, says that under Spanish Bar rules many retention contracts would not be permitted.

The form asks law firms to state their costs for each stage of work and allows GE Medical a platform from which to reduce them by questioning, for example, the manpower needed to complete a certain task.

The conference was organised by Management Centre Europe and attracted about 150 delegates.