US law firm Fulbright & Jaworski has just published its latest litigation trends survey, which this year saw the sample expanded to include corporate counsel and in-house lawyers from UK companies. Although much of the content falls outside the scope of this column, the findings do suggest in-house legal departments are now struggling with the same broader management issues that lawyers in private practice have faced for years.

For example, when asked about the impact of the Woolf reforms, 27% of in-house legal departments in this country said the total costs of litigation had increased, 18% said they had decreased, 29% said there had been no effect and, worryingly, 26% replied 'don't know'. But why didn't they know?


Perhaps one reason is that, according to the report, only 36% of UK companies always track the time it takes to resolve matters - which sounds poor until you learn that in the US, only 20% of companies follow this discipline.


And, why do UK companies apparently employ almost twice as many lawyers to manage litigation (8.3 on average) as their American counterparts, who average 3.7? Is it because UK lawyers are more thorough - or is it because they are less efficient? Another of the survey's findings reveals that each UK in-house lawyer is responsible for managing an average of 3.9 litigation matters, compared with an average of 10.2 cases by US lawyers, which perhaps suggest the latter. Then again UK lawyers do seem to be able to resolve disputes far quicker - for example, it takes an average of 98 days to resolve a contract claim, compared with 138 days in the US.


This whole air of uncertainty is highlighted by the survey's findings on fees. Respondents who do track legal costs reported their budgets for all types of legal work averaged 1.34% of their companies' gross revenue (while there are US companies that are spending more than 5%), with some in-house lawyers expressing more concern over the cost of litigation than the outcome.


The survey also found that 43% of in-house lawyers were unable to quantify their litigation budgets in relation to their overall legal department spends. Yet can they complain when only 56% of UK companies require a budget (the figure is even lower - 35% - in the US) from the outside firms they instruct?


In the 1980s and early 1990s, when budgeting and financial management skills, and the IT systems needed to supply this kind of data, were still relatively poor, many solicitors' practices were running unprofitable departments and branch offices as they could not see or recognise the problems they faced.


The Fulbright & Jaworski report indicates in-house lawyers face the same type of problems but lack the information and IT systems needed to help make informed decisions on how to manage litigation more effectively.


Charles Christian is an independent adviser to the Law Society's Software Solutions guide