This year, City firms billed their clients more than £6 billion.
Each Slaughter and May lawyer pulled in more than £700,000, generating nearly twice as much revenue as their nearest rivals at City firm Linklaters.
But they are not the only lawyers billing furiously as the market booms -- the entire legal market in the UK was worth £8.645 billion last year.Many clients and a small minority of firms are wedded to hourly billing.
But a Gazette survey indicates that a larger number are prepared to ditch their time-based bills in favour of project-based pay and success fees.The survey revealed a 50-50 split between companies that simply cannot imagine life after hourly rates and those that envisage an end to the time-based culture as the future of billing.
But the real revolution in thinking is going on in the law firms themselves.
More than 80% of the top 25 law firms that responded to the survey say they may dump their hourly bills in favour of fixed and success fees.
Some said the shift is already happening, while one thought the change would be some time away.Nabarro Nathanson's finance director, Andrew Scholefield, suggests: 'There will always be a place for time-based billing.
However, there is a role for lawyers to participate in the risk and reward of a project.
In addition, estimates can be used but the scope of the work needs to be clearly defined and understood by the client.'A third of the top 25 City law firms questioned said they charged clients hourly rates, fixed fees, annual retainers and conditional fees, dependent on the client and the transaction.
'We don't care, as long as we get paid,' was the frank response of the managing partner at one magic circle practice when asked about his firm's billing methods.All these firms forecast a move from time-based charging, as did a further 40% that offered various options apart from hours.
Berwin Leighton's finance director, Charles Whittan, suggested that the choice is effectively market-driven, and pointed out that fixed fees might be more appropriate for a commercial property transaction, while litigation would be charged on an hourly basis.Slaughter and May's finance partner Jonathan Haw predicts law firms will move away from time-based billing and instead use 'a basis that reflects the value to the client of, for example, the factors in the non-contentious fees order', which is the way the firm tends to bill.
Slaughters lawyers charge for value-added legal advice, as well as research and expenses.Despite the anticipated billing revolution, all companies surveyed still pay for outside lawyers' time.
Hourly rates are usually discounted, but also blended.
Half the respondents also pay annual retainers or negotiate fixed fees.'Unless the receiver of the service is in possession of more sophisticated information to compare, contrast and form the basis of negotiation with lawyers, billing methods will not radically change,' warns a cautious Legal & General corporate counsel, Geoffrey Timms.Most blue chip clients have elaborate billing needs.
Lloyds TSB is typical.
The bank's head of legal, Geoffrey Johnson, says his company has complex billing arrangements, because it is not just the legal department that hires lawyers, and different areas have different billing needs.
Mr Johnson says: 'We talk to them quite carefully about how we want to be billed.
And that's changing all the time.' Ultimately, it's the client that holds the purse strings.
Or as Mr Johnson puts it: 'It's a question of the clients managing the solicitors.'This point is not lost on Shell UK's Richard Wiseman, who is clearly not prepared to put up with any nonsense from his law firms as far as bills are concerned.
He is not the only in-house lawyer who has been scrutinising developments in private practice such as rising levels of pay for junior lawyers.
Shell has banded together with a number of other companies to look at pay.
Now that law firms in the City are paying their junior lawyers substantially more, there is a fear among clients that this cost will be passed on to them.
Mr Wiseman is adamant that this is one bill he does not expect to land on his desk.As far as the usual bills are concerned, Mr Wiseman says Shell rules out use of annual retainers and conditional fees, which he dismisses as 'not appropriate'.
Instead, he sticks to his guns, picking the proverbial 'horses for courses'.Photocopying came top of the list of expenses that corporate counsel do not expect to see on their bills.
But there were other pet hates.
They expect their law firms to bear some travel costs, and do not want to end up paying for on-the-job training or getting up to speed on the client's business.
Clients also reported that they have disputed bills where they have been charged for the use of inexperienced juniors.So what are they willing to pay for, aside from pure legal advice? Responses to the Gazette's survey showed that market knowledge, commercial acumen and knowledge of competitors were three vital areas.
Clients are also prepared to pay for their lawyers' presence at meetings and pay for seconded lawyers.
There is also evidence of law firms charging for support services such as updates on legislative changes that might affect their clients' business.
While some firms offer this service free of charge -- increasingly now over the Internet -- some practices charge for access to their support services such as law libraries and training facilities.Arguably the king of corporate counsels' gripes is 'not being kept up to date on the level of accrued fees or the number of fee earners involved'.
But on this front, the future looks sunny for clients.
One magic circle firm says time-based billing will be replaced by assessment according to the value of the transaction and the market, and it envisages electronic, on-line rolling billing, followed by e-settlement.Most firms now have computerised hourly recording methods, with Carpe Diem the most popular software used among the top 25 firms.
Firms that did not use Carpe Diem used a mixed bag of software, including packages that appear to have been developed in-house.Many other top 25 firms suggested billi ng would change through use of IT and improvement in transparency.
They also predicted a shift towards fixed quote fees.Although many clients are not pushing for a change from hourly rates, there does appear to be a concern that an hourly system does not promote efficient working within a firm.
If you string it out, the argument goes, you will get paid more.
Stuart Benson, a consultant at London-based legal practice consultancy Patro and former DLA partner, says recent billing history shows that hourly charge-outs have only become the norm in the last decade, while they used to be much more project-based.But the in-house response to the resurrection of project-based dominance is reserved.
The UK head of legal at oil and gas company Agip, Daragh Fagan, suggests that fixed fees and annual retainers could replace time-based billing.
But he anticipates that time billing will remain central even if there is a pull away from hourly charge-outs.
And Legal & General's Mr Timms says chargeable hours can be replaced by commodity and unit charges, to be determined jointly with law firms.So the clients have made suggestions, what about the firms? 'They don't have the imagination to see how alternatives could work,' says Mr Benson.
But they have come up with a few ideas about how to prize out the cash.
Although only one respondent mentioned payment in shares would be an option and none of the respondents would accept credit card payments, many accept payment in foreign currency, including the euro.The Gazette survey shows the willingness of law firms to look at new billing methods, but a surprising caution among their clients.
But as in-house lawyers begin to compare notes, they may well release their lawyers from hourly constraints and focus on the job in hand.