Bailey-Vella: Broad range of skills
The advent of artificial intelligence (AI) means that lawyers will need to become more creative in how they charge their clients, with the billable hour unlikely to survive, it has been claimed.
But the ‘judgement call’ of lawyers and judges has to be retained, a roundtable organised by the Association of Costs Lawyers (ACL) heard.
Costs lawyer Simon Murray, who heads DWF’s insurance, digital and business services divisions and leads on much of the national firm’s efforts to adopt AI, told the event: “We need to stop doing the really boring stuff and add value, and charge for the value in the right way.
“Whether that is £10,000 an hour, or whether that is a fixed fee, or whether that is skin in the game with a contingency fee, whether that is a retainer – charging X pounds a month to do all of a particular client’ work – we are going to have to be more creative as costs lawyers and as lawyers more generally in the way we charge. I just do not think the hourly rate can survive.”
Mersedeh Safa, a costs lawyer and legal director at City firm Clyde & Co, where she manages the commercial costs team, observed that this would require “a complete change in law firm culture because everything at the moment is calculated based on profitability and hourly rates”.
More broadly, Mr Murray said, the shift away from repetitive to value tasks “should hopefully democratise law” by enabling more people to afford legal services.
“We get challenges from even institutional clients where they say, ‘Why should I not just use ChatGPT to create this purchase agreement?’ Whilst it’s not advisable for numerous reasons, it’s a fair challenge.”
Erica Bedford, a barrister at Kings Chambers, a deputy costs judge and chair of Women in Costs, pointed out that pricing legal services was very different from tangible goods.
“Claims are always really important to the claimants, irrespective of whether it is a business an individual. Particularly if they are individuals, they can subsume their lives.
“In those circumstances, where they feel they have somebody on their side and they can see on an hourly rate basis the time that is being put in, I think they actually get some value from that because they feel that they are being looked after.”
Mr Murray suggested that AI could be the answer to that too, such as a chatbot that can interrogate the lawyer’s file on a real-time basis.
“Many consumers who are asked about this find that, with the right chatbot, with a good interface and natural language, they feel like they have had either as good or better information than if they were conversing with a human being.”
Ms Bedford added that costs judges often made qualitative decisions on what are quantitative issues, “and the interface between those two sometimes can create tension”.
She went on: “I do see that AI can be a really useful tool within the arsenal that one has to make everybody’s lives easier, as long as the judgement call is still retained so the lawyer can still deliver their particular expertise and also look after the people that they are servicing. This is a people-driven business.”
Speaking after the event, ACL chair David Bailey-Vella said: “Costs lawyers, as with all other parts of the legal profession, are having to work out what the growth of AI means for them and their clients.
“While the billable hour has endured, plenty of lawyers already use other forms of charging, often underpinned by our members’ knowledge of how legal matters are priced.
“I understand that some people will fear this technology but we are confident that, even if aspects of costs lawyers’ work changes – such as by automating aspects of bill drafting – the broad range of skills we have will continue to add real value to our clients.”
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