SERVICES: electronic and paper bills have same legal status


A change in the legal status of electronic bills is set to increase pressure on corporate firms to offer e-billing, the Gazette learned this week.



Provisions in the Legal Services Act 2007, which come into force this week, will give electronic bills the same legal status as paper bills.



This means that law firms will no longer be able to insist on paper bills - which do not usually provide the same level of detail - on the basis that e-bills are not enforceable. E-bills can give clients access to detailed information that shows exactly how much time has been spent on their account, and by which fee-earner.



London finance manager at magic circle firm Allen & Overy, Patrick Collins, said the provisions would force firms to 'smarten up' their billing practices. He said: 'The benefits of e-billing mostly favour the clients, helping them manage their outside legal spend better and pointing the way towards reducing their legal bills.



'But irrespective of the pros and cons, e-billing is here to stay and law firms must smarten up the way they invoice their corporate clients before they begin to look elsewhere.'



A spokesman for the Law Society's legal policy team, which lobbied for the change, said clients and law firms should agree on an e-billing standard to save costs on both sides. He added: 'E-billing marks a move towards a more networked relationship between clients and external law firms. Time will tell whether that is a threat or an opportunity for legal advisers.'



In-house counsel Mark Holford, director of service at City insurance boutique Thomas Miller & Co, said: 'E-billing is about having better information to manage the service. It doesn't need to be nit-picking, but a process agreed between the client and the law firm... I expect very little resistance when it begins to roll out here [as it already has in the US].'



Jonathan Rayner