The Lawyers Weekly - In House Counsel, Spring 2012

vice without being in a conflict situation.

He explains it’s also about getting “the right lawyer on the right file,” and not having a senior partner review documents that a less expensive junior associate could easily do.

Should the initial interview—or date — with a law firm lead to a business partnership, it must be viewed as a “ marriage,” Fisher says.

“The critical part of the relationship
is establishing mutual expectations, and
defining with the firm—in a solid re-
tainer letter — what exactly you’re look-
ing for and the desired result.”
When searching for the right match,
Bell Canada Enterprises Inc.’s legal de-
partment puts its prospective partners
through their paces. Every three years,
BCE sends a request for proposal (RFP)
to about 20 law firms across the country
to submit bids for day-to-day work in-
volving everything from commercial and
labour law to litigation, explains Michel
Lalande, senior vice-president and gen-
eral counsel at BCE in Montreal. Files
involving large litigation cases and major
merger and acquisition activity are hand-
ed to external counsel on a case-by-case
basis since Canada’s largest communica-
tions company cannot hire law firms that
may have represented a party involved in
either situation, Lalande says.

BCE works with many of Canada’s major law firms, including Gowlings, Norton Rose, McCarthy Tétrault and Borden Ladner Gervais, as well as with smaller boutique practices in the areas of patents and trademarks.

With the RFP process, BCE evaluates bids based on quality (for example, which outside lawyers would work with the company), cost and predictability.

“This is about ongoing legal work that needs to get done over three years and my budget won’t grow,” explains Lalande, who heads a team of about 50 lawyers, mainly in Montreal and Toronto.

He says that BCE favours fixed fees — purchased in advance at a lower rate — and blended hourly fees. “It forces the firm to manage a file very tightly and ensures the senior partner is only involved when necessary,” Lalande explains. “I need firms as my partners to help me meet my budget. Those that do that ensure they’re going to be with us for a long time.”

“

IF I’M
SPENDING ALL
MY TIME LOOKING
AT THE MINUTIAE
OF WHAT THE
LAW FIRM IS
DOING, THEN
I’M NOT DOING
MY JOB.
— Barry Fisher,
Vp, general counsel
sap canada inc.
“

CE’s legal department includes a senior lawyer, Miguel Baz, who liaises with external counsel and receives monthly reports on the status of files that firms are working on and the firm’s compliance with the terms of the RFP. Additionally, every quarter, the department prepares projections on its major files on costs and issues that need to be addressed. Once a year, Lalande meets with senior management of firms working with BCE to discuss “what’s going well, what’s going less well” and explore areas for improvement.

B

In-house lawyers need to be good proj-
ect managers when dealing with out-
side counsel, says SAP’s Fisher. “That
means regularly assessing who performs
the work, what terms they do it on and
under what time frame — and staying on
top of the budget so there are no surpris-
es when you get the bill.”
As the pit crew boss, it’s not about mi-
cromanaging, he stresses.

“If I’m spending all my time looking at
the minutiae of what the law firm is do-
ing, then I’m not doing my job,” Fisher
says. “At the other extreme, I’m also not
doing my job if I just hand a matter over
to a firm to solve a problem and say, just
send me the bill when finished.”
He adds that it’s more than just ne-
gotiating lower hourly rates—which is
“not adding value; it’s just dealing with
costs.” However, he points out that in-
house lawyers need to consider whether
alternative fee structures, such as fixed
fees, capped fees, and contingency (if
you don’t win, you don’t get anything)
or reward-risk (if expectations are ex-
ceeded, there can be a top-up; if they
underachieved, both parties can share
the downside) fees, are appropriate with
a specific kind of transaction.

Commonly, corporate counsel pursue a blend of hourly fees for more complex legal services and fixed fees for standard transactions, such as mortgages, or obtaining work visas for employees, Fisher says.