The new Legal Services Bill has heralded an already acknowledged intent by the powers that rule the taxation of Solicitors’ costs to move toward billable hours. theTaxing Master has already indicated that he requires a note of the hours recorded and of the time spent with the obvious inference that a calculation will be carried out in terms of an average hourly rate.
This is not unusual in the commercial world. Examiners and Liquidators have regularly charged billable hours which are subject to taxation by the Courts and adjustment as appropriate.
However, a wind of change appears to be blowing in Washington where Firms like Holland & Knight are bidding adieu to the billable hour. The head of their Public Policy & Regulation Group, Rich Gold, considers them to be the leaders in what will be a very large trend.
The Firm which brought in almost $10m for Federal lobbying during the first six months of 2011 is not only getting rid of their billable hour systems but their Lobby and Professional will no longer keep track of their time at all.
He went on to say that the new system removes the burden of trying to bill which client for intelligence gathering on Capitol Hill and the general relationship building exercises which take place in order to put that firm into the premier position.
There are benefits for the practices. Most lobbying clients pay a monthly retainer between $12,000 and €15,000 per month and a Company whose base is located in Washington generally would charge on the order of $50,000 per month. I’m not really sure that’s in the best interests of clients, excepting only those with very deep pockets.