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hourly rate survey causes a storm

Thu, 24 Sep 2009 11:54:54 +0100

After 3 days of circulating my 2009 hourly rate survey both the legal and international press have published articles on it:including the The Lawyer, The Times and The Wall Street Journal...

See the full list and links below.

Wall Street Journal

http://blogs.wsj.com/law/2009/09/21/no-joke-top-firm-partner-rates-falling-fast-at-least-in-the-uk/

The Lawyer

http://www.thelawyer.com/magic-circle-muscles-in-on-silver-circle-with-fee-drops-and-freebies/1002022.article

The Times

http://business.timesonline.co.uk/tol/business/law/article6843514.ece

Law 360

http://www.law360.com/registrations/user_registration?article_id=123691&concurrency_check=false

Lawyer.net

http://lawyrs.net/news/show/2394/hourly-rates-at-top-uk-law-firms-drop-by-a-third

Eurobankers.net

eurobankers.net - http://eurobankers.net/

Management Today

http://www.managementtoday.co.uk/News/MostEmailed/940064/magic-circle-lawyers-lose-power-fees-slashed/

Am –News.

http://www.cityam.com/news-and-analysis/pdr4u4jzvb.html

2009 - HOURLY RATE SURVEY

Tue, 22 Sep 2009 15:19:09 +0100

BUBBLE HAS BURST AS CHARGE OUT RATES FOR TOP LAWYERS HALVED

LAW firms have slashed hourly rates by as much as 50 per cent as they fight for business in a shrinking market.
And the 2009 hourly rate survey of top firms predicts that 10,000 more jobs will go in the legal sector in the next 12 to 18 months.
However, what might be agony for the profession will be sweet music to the ear of clients as the survey’s compiler, legal costs lawyer Jim Diamond, says that any client retaining a lawyer on 2008 rates should immediately ask for a discount.
Last year the survey of firms across the sector showed that magic circle partners were being charged out at up to £900 an hour.
However, Mr Diamond said: ‘It is now possible to retain a magic circle firm partner for under £500. It is the first time in at least five years such a rate has been available. In fact a discounted deal rate for a magic circle partner could be around the £400 mark in reality.’

Last year’s survey was compiled during the summer of 2008 and predicted a severe down turn BEFORE the credit crunch hit. It also forecast that clients would become more sophisticated in negotiating better reductions on charges.
It further predicted that when the bubble burst about 5,000 lawyer would be unemployed. Mr Diamond said that when he checked the ‘job watch’ (in regard to lawyers unemployed) section of The Lawyer magazine in July 2009 the actual figure they quoted was 4,800.

In the year ahead Mr Diamond anticipates job loss numbers to double as compared to the last 12 months.
‘I can foresee carnage in the legal market place if work does not pick up and pick up now. In the next year I anticipate 10,000 lawyers and support staff being made unemployed or working part-time,’ he said.
During the last 12 months Mr Diamond said there were numerous examples of firms slashing charges as they desperately sought to secure work.
In one instance, he said where a magic circle firm quoted £1 million for a job that was up for grabs, a silver tier law firm put in a bid that was 60 per cent lower than their city rivals.
‘It gives an idea of the discounts involved,’ said Mr Diamond.

He said that for the previous five or six years, year-on-year, rates have grown at double digit percentages. Mr Diamond said it was unrealistic of the profession to expect that growth to continue. ‘Somewhere down the line the bubble had to burst,’ said the legal costs lawyer.
He said that law firms have been offering, as standard, reductions in hourly rates of between 10 to 15 per cent as compared to last year’s figures.
‘What will affect the legal industry hugely over the next 12 to 18 months are the discounted rates being given to – or should I say demanded by – the client. I would suggest discounted rates are being negotiated in the 20 to 35 per cent bracket as a matter of course with the highest being about 50 per cent,’ he said.
In the 2009 survey Mr Diamond predicts that the fall in rates will have a ‘crashing effect’ on lesser law firms whose charges followed the boom for the big City boys.
‘Gone are the days when a mid rank firm can justify their rates on the basis that the magic circle is 50 per cent plus more than theirs. Call me old fashioned but lawyers will have to justify rates on the basis of expertise and value offered to a client,’ said the legal costs lawyer.

The survey also covers the offshore sector and this year revealed the surprising finding that the Channel Island of Jersey is now probably the most expensive place in the world to commission legal services.
‘Rates grow continuously on Jersey to such an extent that for non specialist lawyers, as a general rule of thumb, it is the most expensive place on the planet for legal services,’ said Mr Diamond.
Such is the reliability of the survey that the 2008 results were reproduced in an initial report published in May this year by Lord Justice Jackson entitled ‘A Review of Civil Litigation Costs’, which the senior judge prepared for the UK government.

Ends

Notes to editors
Jim Diamond has compiled the definitive hourly rate survey of top law firms for a decade and the survey results have been published in the profession’s ‘bible’ the Legal 500.

As a leading legal costs expert Mr Diamond continuously monitors the market place and hosts regular discussion forums with buyers and sellers of legal services.
The information in the survey is gleaned from a number of impeccable sources and the results are accepted (grudgingly) by the legal profession as an accurate reflection of the marketplace.
It is so reliable that Lord Justice Jackson reproduced the 2008 survey in his initial report for the UK government entitled ‘Review of Civil Litigation Costs’. A senior member of LJ Jackson’s team also sought Mr Diamond’s views as part of an ongoing consultation process.
The survey is FREE and available to both buyer and seller of legal services..

About legal costs lawyer Jim Diamond
Jim provides a comprehensive service on all aspects of legal costs and budgets and has worked for over 25 years in the industry.

He became one of the first ever qualified Costs Lawyers (Section 27 of the Courts and Legal Services Act 1990) in 2007 and has direct rights of audience up to the House of Lords on costs related cases.

He worked in-house for two of the top City law firms. Clifford Turner (now Clifford Chance) in the 80s and Allen & Overy in the 90s. He has acted for or against the majority of the top 100 English law firms on costs disputes. He has also acted on many major costs disputes in Jersey.

Jim has published many articles and spoken at many major conferences on the subject of legal costs. He was the first ‘civilian’ to be invited as a speaker at the Judges and Costs Judges forum on Costs at the Royal Courts of Justice in 2005.

2009 saw him invited to present his views on budgets to Lord Justice Jackson’s team charged by the UK government with conducting a review of the costs of civil litigation.

Software

Jim has created a unique software program that can calculate the potential legal costs of litigation, covering anything from small domestic disputes to multi-million pound claims.

The software is simple to use and is aimed at both the buyer of legal services and the legal profession.

Version 1.0 was used as part of a presentation given to the 2003 Law Society Annual Conference.

Version 2.0 was used as part of a presentation at the 2005 Judges and Costs Judges Forum at the Royal Courts of Justice.

Version 3.0 is the latest and most simple version. This was presented to Lord Justice Jackson’s team at the Royal Courts of Justice in March 2009.

Contact:
Tel: 07896 287 405
Email: jim@jimdiamond.com
Address: 20 Beauchamp Place, Knightsbridge, LONDON SW3 1NQ--www.jimdiamond.com

JIM DIAMOND COSTS LAWYER
20 BEAUCHAMP PLACE
LONDON SW3 1NQ
<http://www.jimdiamond.com/> www.jimdiamond.com
E-MAIL: jim@jimdiamond.com

JIM DIAMOND 2009
HOURLY RATE SURVEY

STATS HAVE A 5% +/- ERROR FACTOR

CITY OF LONDON- "MAGIC CIRCLE" FIRM

PARTNER PER HR
YEAR 2003 375-450
YEAR 2005 425-525
YEAR 2007 625-700
YEAR 2008 600-750
YEAR 2009 450.00

5 YEARS PQE

YEAR 2003 245-280
YEAR 2005 250-300
YEAR 2007 375-400
YEAR 2008 350-400
YEAR 2009 375.00

Newly Qualified

YEAR 2003 175-185
YEAR 2005 180-215
YEAR 2007 235-250
YEAR 2008 250.00
YEAR 2009 250.00

US Top Law firm
Figures available only from 2007

PARTNER
YEAR 2007 450-500
YEAR 2008 425-550
YEAR 2009 400.00

5 YEARS PQE
YEAR 2007 325-360
YEAR 2008 300-375
YEAR 2009 325.00

NQ's
YEAR 2007 215-225
YEAR 2008 225.00
YEAR 2009 225.00

TOP LONDON FIRMS (OUTSIDE THE MAGIC CIRCLE)

PARTNER
YEAR 2003 325-375
YEAR 2005 350-475
YEAR 2007 400-495
YEAR 2008 375-495
YEAR 2009 375.00

5 YEARS PQE

YEAR 2003 215-225
YEAR 2005 225-300
YEAR 2007 285-315
YEAR 2008 250-295
YEAR 2009 250.00

Newly Qualified

YEAR 2003 150-155
YEAR 2005 170-195
YEAR 2007 185-225
YEAR 2008 195.00
YEAR 2009 180.00

Major and National law firms (with offices in Birmingham, Leeds, Manchester & Birmingham

PARTNER

YEAR 2003 185-250
YEAR 2005 190-315
YEAR 2007 350-375
YEAR 2008 300-375
YEAR 2009 325.00

5 YEARS PQE

YEAR 2003 135-195
YEAR 2005 150-225
YEAR 2007 225-275
YEAR 2008 225-275
YEAR 2009 250.00

Newly Qualified

YEAR 2003 100-140
YEAR 2005 125-160
YEAR 2007 185-210
YEAR 2008 195.00
YEAR 2009 175.00

Channel Islands -Jersey

PARTNER

YEAR 2003 300-350
YEAR 2005 325-400
YEAR 2007 400-450
YEAR 2008 450-500
YEAR 2009 475-525

5 YEARS PQE

YEAR 2003 225-235
YEAR 2005 235-275
YEAR 2007 260-295
YEAR 2008 275-295
YEAR 2009 300.00

Newly Qualified (Advocate)

YEAR 2003 150-160
YEAR 2005 175-215
YEAR 2007 195-225
YEAR 2008 225-250
YEAR 2009 275.00

Annual Conference 9th June 2009

Tue, 2 Jun 2009 13:52:43 +0100

I am delighted to report that I have been invited to speak at the above conference on the subject of budgets.

The main speaker at the conference is Lord Justice Jackson, who will be talking on his recently published report on the future of costs in civil litigation.

Mon, 1 Jun 2009 11:04:40 +0100

Press Release from Jim Diamond (Costs Lawyer) & LawWorks – MAY 2009

Costs Lawyer, Jim Diamond and the national pro bono charity, LawWorks, have announced a new partnership to help provide people and pro bono lawyers in England and Wales with a free service that will help them estimate legal costs and keep clients properly informed of the risks of litigation.

Lord Justice Jackson’s recent interim report on costs in civil litigation made it clear where the future of legal costs is headed and this venture very much supports his initiative. LawWorks will encourage advisors who require estimates on costs to download a copy of Diamond’s latest LegalBudgets software free of charge. In addition, Diamond will offer free online consultation for any advisor unable to operate the software themselves. This unique application allows a potential litigant to obtain a broad outline of how much a legal dispute may cost them and the other side (assuming they are paying a lawyer). For a pro bono client, the advantage is appreciating in advance the sort of costs they might face if they lost in court. It is hoped, also, that this appreciation may lead to more people mediating their disputes using LawWorks free mediation service.

As an example, a claimant may be trying to recover £10,000 from a neighbour in a dispute where damage has been caused to their property. Use of the software may indicate that a seemingly straightforward case such as this could cost around £25,000 to get to court. If the claimant hired his own lawyers and loses the case, he risks being ordered to pay the costs of the defendant, as well as his own, potentially taking the total risk to around £50,000.

With Section 194 of the Legal Services Act 2007 now in force the courts are able to make costs awards against the losing party even where the other side has been represented on a pro bono basis (with those notional costs being directed towards the Access to Justice Foundation). It is, therefore, important that pro bono lawyers record their time as if working on a commercial basis. Accurate costs estimates and pro bono time recording will, therefore, also provide a useful bargaining tool in negotiations with the other side.

The easy-to-use program was initially developed by Diamond several years ago and can be used for virtually any type of litigation. Since then the programs have been updated and refined so that they encompass new developments in legal cost budgeting.

The software is already used by law firms. The London branch of the Law Society’s Commerce & Industry Group, which looks after the interests of hundreds of in-house lawyers in the capital, fully endorsed the software’s use to its members in 2004. In March 2009, Diamond was invited by Lord Justice Jackson’s team to present the same budget software and his views on budgeting.

Notes to editors
LawWorks is the operating name of the Solicitors Pro Bono Group and is an independent charity with a mission to support, promote and encourage a commitment to pro bono across the solicitors' profession. It also helps individuals and community groups to access free legal advice.
Solicitors across England and Wales have always provided free or reduced cost legal advice and assistance to those individuals who are ineligible for legal aid from the Legal Services Commission but unable to afford legal fees (pro bono services).
LawWorks is a membership-based organisation whose members are law firms, in house legal departments and other organisations interested in contributing to the provision of legal pro bono work in England and Wales. LawWorks provides practical support, advice and information to them through a range of projects. For more information go to www.lawworks.org.uk.

The Access to Justice Foundation was founded to be the recipient of, among other things, funds ordered to be paid following a Section 194 Order. Visit the foundation’s website for more information - www.accesstojusticefoundation.org.uk.

Jim Diamond – you can find out more about Jim Diamond at www.jimdiamond.com.

Lord Justice Jackson’s interim review of civil litigation costs can be found here - http://www.judiciary.gov.uk/about_judiciary/cost-review/preliminary-report.htm.

2008-hourly rate survey

Fri, 24 Apr 2009 11:20:00 +0100

HOURLY RATE SURVEY 2008- JIM DIAMOND

CITY OF LONDON- "MAGIC CIRCLE" FIRM

After 5 years of continuous growth in hourly rates for all level of fee earners from newly qualified lawyers to partners at the major law firms 2008, the 'credit crunch' has hit and hit hard with virtually no growth in hourly rates.
The headline top city of London partner has 'hit' the £750.00 per hour mark.
In real terms however, as I conducted a survey of over 250 in-house lawyers, discounted hourly rates are the norn. Discounts of 10-20% on hourly rates were noted as well as a global discounts of legal spend in the 30% bracket.
No discounted hourly rates information was obtained legal work in the Channel Islands.
STATS HAVE A 5% +/- ERROR FACTOR---As the stats were prepared in August 2008-

PARTNER
PER HR
YEAR 2003
375-450
YEAR 2005
425-525
YEAR 2007
625-700
YEAR 2008
600-750

5 YEARS PQE

YEAR 2003
245-280
YEAR 2005
250-300
YEAR 2007
375-400
YEAR 2008
350-400

Newly Qualified

YEAR 2003
175-185
YEAR 2005
180-215
YEAR 2007
235-250
YEAR 2008
250

US Top Law firm

Figures available only from 2007

PARTNER
450-500
2007
450-500
2008
425-550

5 YEARS PQE

2007
325-360
2008
300-375

NQ's

2007
215-225
2008
225

TOP LONDON FIRMS (OUTSIDE THE MAGIC CIRCLE)

PARTNER

YEAR 2003
325-375
YEAR 2005
350-475
YEAR 2007
400-495
YEAR 2008
375-495

5 YEARS PQE

YEAR 2003
215-225
YEAR 2005
225-300
YEAR 2007
285-315
YEAR 2008
250-295

Newly Qualified

YEAR 2003
150-155
YEAR 2005
170-195
YEAR 2007
185-225
YEAR 2008
195

Major and National law firms (with offices in Birmingham, Leeds, Manchester & Birmingham

PARTNER

YEAR 2003
185-250
YEAR 2005
190-315
YEAR 2007
350-375
YEAR 2008
300-375

5 YEARS PQE

YEAR 2003
135-195
YEAR 2005
150-225
YEAR 2007
225-275
YEAR 2008
225-275

Newly Qualified

YEAR 2003
100-140
YEAR 2005
125-160
YEAR 2007
185-210
YEAR 2008
195.00

Channel Islands

PARTNER

YEAR 2003
300-350
YEAR 2005
325-400
YEAR 2007
400-450
YEAR 2008
450-500

5 YEARS PQE

YEAR 2003
225-235
YEAR 2005
235-275
YEAR 2007
260-295
YEAR 2008
275-295

Newly Qualified (Advocate)

YEAR 2003
150-160
YEAR 2005
175-215
YEAR 2007
195-225
YEAR 2008
225-250

JIM DIAMOND F.A.L.C.D.

COSTS LAWYER & COMMISSIONER FOR OATHS

www.jimdiamond.com