RESEARCH suggesting partners at top City law firms are pocketing £1,000 an hour is stunning at first blush. It is the highest rate ever recorded, and spotlights a sub-section of an elite profession that has not exactly been bled raw by the government’s austerity programme.
It is good to see the litigation crew bearing a stiff upper lip.
But, mulling the high-rent legal milieu in all its recondite glory, that initial wonderment somehow segues into mild surprise. Things are what they are.
As with investment bankers, it does seem the more clients pay, the more they think the advice is worth. Reassuringly expensive, and all that. The report from the Centre for Policy Studies think-tank says hourly rates for partners at leading commercial law firms have risen, after inflation, from about £598 in 2003 to at least £775. Some go as high as a grand an hour for their time.
Apparently, Britain’s top legal partners are now giving their cousins in America – the land of the free and the class action – a run for their money in the cash-making stakes. That may be because business is international, and word gets around among our FTSE 100 companies and their counterparts on Wall Street on which are the relatively small collection of top law firms worth hiring when corporate legal needs arise.
Meanwhile, it can be a source of amusement that it appears a corporate article of faith that mega-merger deals must be finally inked in the parties’ lawyers’ offices at some unconscionable hour of the early dawn… while the legal fees clock ticks down silently.
This can often be followed by some “colour” leaked to the press by financial PR consultants about how final merger terms and accompanying legalese magically crystallised in the wee hours as all concerned were sustained by pizza and burger takeaways. It gives a sort of demotic sheen to the, er… process.
On wider business issues and developments, the PR guild (which can but dream of what the legal partners earn) will tell reporters as early as the first glass of wine how it is top-end lawyers who are the bane of their lives in going over press releases with a pettifogging comb. It all takes up time. Ker-ching.
In some ways, the City’s magic circle of top law firms (no names, no pack drill, we have to talk with these people) may be encouraged in their more ambitious fee demands by Britain having debouched with some grace from the financial crisis and resurgent merger activity.
There have also been more big legal firms from the US opening swanky offices in London, from the West End to the Square Mile and down-river to Canary Wharf. And where professional America goes, the cash train tends to follow.
Some judges have suggested hourly billing is unsustainable and should be replaced by fixed fees. Good luck with that one. As in Dickens and Bleak House, money and opaqueness have always made the legal world go round.