£1,000 an hour for a lawyer is a fast-cycle rinse

There are times when you really need a good brief. But they sure know how to charge.

by Matthew Gwyther
Last Updated: 05 Feb 2016

If we ever find ourselves in a tight spot the one thing we all need is a good lawyer. On the - mercifully few - occasions in my life when things have got legally sticky I have been grateful for the assistance of m’learned friends in both the family and defamation divisions. (The miserable wretch who sued me for libel 30 years ago got in touch out of the blue the other day for a sneer and the email correspondence which ensued was the most obscene I’ve ever engaged in.)  I’m eternally thankful I’ve never required the help of the brief who comes to visit you in a police cell.

The relationship between a client and lawyer is not unlike that of a patient and doctor. The law is a dark, arcane world of which the lay person knows little. (And it’s very deliberately kept this way. That’s why they wear wigs and tights.) You need a helping hand in the gloomy forest. A thread as you advance through the labyrinth. The most serious things are at stake and you put very important parts of your life in their hands.

I clearly recall almost coming to blows with my barrister during my divorce. I can still see him now - the sweat rings under the arms of his three piece suit - as we argued outside some dismal panelled room in the Courts of Justice on the Strand. I liked him because he was a street fighter but I just wanted him to land a few more telling blows on the other side. If he didn’t do it I was certainly ready to swing. He was younger than me and I heard the other day that he died two years ago, which was a shock. We’d formed a bond and although he cost me a small fortune I didn’t really begrudge it. I also recall observing at close hand the unbearably tense negotiating battles of an acquaintance who was suing for unfair dismissal - and he got £10 million.

My dad was an old school very non-Magic Circle solicitor so I’m a bit biased. Lawyers are also often good company - fun, quick and bright. I didn’t see one of my oldest friends who is a lawyer for about 18 months and when we finally hooked up he had transformed into a woman. Which was interesting.  

But, my god, they cost. A new study from the Centre for Policy Studies has shown that some partners at top London law firms are now charging £1,000 per hour for their time, the highest rate ever. The author says that this kind of extreme rate inflation means access to justice for businesses, especially small ones, is restricted. And when the British tax code is now 22,000 pages long you need someone to show you how it works. Fixed fee billing has been suggested after a review by Lord Justice Jackson but the Magic Circle lot aren’t interested. Why should they be when they’re filling their boots.

I don’t know many individuals who are worth £1,000 per hour. (Certainly not Wayne Rooney who gets far more than that.)  A modest 40-hour week at a grand an hour amounts to £2 million a year but, of course, many pocket more than that. They charge their 23-year-old juniors out at a bargain £200 per hour and make a massive margin as the kids stay in the office photocopying and tying up the pink ribbons on file bundles until 2am.   

If you make partner or silk you’ve hit the jackpot. My first contemporary to buy a seriously big eff off house in the early 90s - it was £300,000 which we all thought was an act of utter madness - was a criminal barrister.

However, law is too often the lead in the saddle of business. The number of times I’ve heard a senior businessperson say something along the lines of:  ‘I thought we had a really good, straightforward deal on which we’d agreed/shaken then we it got handed over to the lawyers and then the wheels just fell off as they insisted on complicating everything and winding the other side up.’

American lawyers are especially awful in this respect. Clumsy, unnecessarily aggressive, process-driven behemoths who think they run the show which, in reality, they often do. They are currently rinsing both RBS and VW in the US where their type rules the roost.

I don’t know what the answer is in commercial law. It’s a market. But It’s one of the few occasions when the deathly hand of the procurement officer should be encouraged. Lawyers should not be allowed to make out like bandits. In the meantime I’d like MT’s lawyers to know I think you’re wonderful, talented, beautiful human beings. Really. Just go easy next time I ring you...

Find this article useful?

Get more great articles like this in your inbox every lunchtime