Spain: ‘Hourly Billing Must Not Detract From The Maxim Of Putting The Client First'

Last Updated: 14 August 2017
Article by Iberian Lawyer
Most Read Contributor in Spain, August 2017

In-house lawyers that used to work at law firms know when external lawyers are billing for time unnecessarily, says Siemens Gamesa's Javier Cabezudo

Though the billable hour is increasingly falling out of favour with law firm clients, Javier Cabezudo, Siemens Gamesa's senior legal counsel, says his organisation still, on occasion, pays external lawyers by the hour. He says hourly billing is very useful for law firms in that it helps them to better assess the size of the workload and distribute it more efficiently. In addition, he believes that hourly billing makes it easier for law firms to assess how they are allocating their resources – whether for high value advice, recurrent work, or deals, for example – and therefore make better strategic decisions regarding resource allocation on future.

However, from a client's point of view, the pressure on lawyers in law firms to invoice and the additional incentives such invoicing provides external lawyers – such as bonuses and visibility within their firm – can sometimes detract from the maxim of "the client is first," says Cabezudo. He adds that this can damage the relationship of trust between client and lawyer, which is vital. "We mustn't forget that many in-house lawyers working within corporations have for some years worked in the same law firms that now provide services to them," Cabezudo says. He adds that such in-house lawyers are knowledgeable about how law firms work, and consequently are able to identify instances where lawyers are billing for time unnecessarily, or providing advice that is making issues more complex or "suggesting legal risks everywhere". Cabezudo says this type of behaviour will jeopardise the relationship of trust between a client and their external lawyer.

Good track record

In April 2017, Spanish wind turbine manufacturer Gamesa merged with Siemens Wind Power, creating a major global wind power industry company, with a presence in more than 90 countries, and total installed generation capacity of 75 gigawatts. The combined entity, Siemens Gamesa Renewable Energy, trades on the Spanish stock market and is one of the biggest industrial companies on the Ibex 35. Cabezudo says that Gamesa's merger with Siemens is an excellent opportunity for the organisation's in-house lawyers to grow as professionals in a sector in which he believes they compete with some of the best in-house legal teams in the world.

Regarding the type of work Siemens Gamesa outsources to external law firms, Cabezudo says: "A pre-litigation issue of certain magnitude or an operation in capital markets are questions that, from a logical point of view, require external law firms with an accredited track record and expertise in the matter," he says. "On other occasions, resorting to an external lawyer can be due to a need to obtain very specific legal advice, such as a validation of a preliminary in-house legal opinion in a specific jurisdiction, assistance with the liquidation of a foreign company, for example, or on other occasions, the simple need for 'legal labour' to assist with an intense workload or a very tight and demanding exercise like due diligence."

Investing time

Siemens Gamesa's in-house legal department looks more favourably on law firms that are able to offer creative advice, while also having an in-depth understanding of the clients' requirements, says Cabezudo. He adds that the preference is for law firms that are "the most agile and imaginative when it comes to getting past the closely-watched pay-by-the-hour system, and who have the flexibility to adapt in order to improve the quality of the legal advice provided". In addition, Cabezudo says he wants external advisers that "invest time and listen to and attend to the needs and concerns of their client –this is guaranteed to establish client-lawyer trust, and this is vital for law firms in securing recurrent work in the future".

Cabezudo adds that the lawyers he values and appreciates most are those that are able to fully understand how their client's business works and then factor that understanding into the legal advice they provide. "In other words, what makes sense in terms of business, and what is common sense, can generally be carried out in practically all the countries in which we operate," he says. "The lawyer will therefore add value by swiftly gaining knowledge of the legal metrics and being capable of translating and adapting the initial focus of the business, and suggesting the adoption of a series of reasonable legal safeguards, which are suitable and appropriate to achieve the desired result."

Javier Cabezudo Pueyo is senior legal counsel at Siemens Gamesa

The content of this article is intended to provide a general guide to the subject matter. Specialist advice should be sought about your specific circumstances.

To print this article, all you need is to be registered on Mondaq.com.

Click to Login as an existing user or Register so you can print this article.

Authors
 
In association with
Up-coming Events Search
Tools
Print
Font Size:
Translation
Channels
Mondaq on Twitter
 
Register for Access and our Free Biweekly Alert for
This service is completely free. Access 250,000 archived articles from 100+ countries and get a personalised email twice a week covering developments (and yes, our lawyers like to think you’ve read our Disclaimer).
 
Email Address
Company Name
Password
Confirm Password
Position
Mondaq Topics -- Select your Interests
 Accounting
 Anti-trust
 Commercial
 Compliance
 Consumer
 Criminal
 Employment
 Energy
 Environment
 Family
 Finance
 Government
 Healthcare
 Immigration
 Insolvency
 Insurance
 International
 IP
 Law Performance
 Law Practice
 Litigation
 Media & IT
 Privacy
 Real Estate
 Strategy
 Tax
 Technology
 Transport
 Wealth Mgt
Regions
Africa
Asia
Asia Pacific
Australasia
Canada
Caribbean
Europe
European Union
Latin America
Middle East
U.K.
United States
Worldwide Updates
Check to state you have read and
agree to our Terms and Conditions

Terms & Conditions and Privacy Statement

Mondaq.com (the Website) is owned and managed by Mondaq Ltd and as a user you are granted a non-exclusive, revocable license to access the Website under its terms and conditions of use. Your use of the Website constitutes your agreement to the following terms and conditions of use. Mondaq Ltd may terminate your use of the Website if you are in breach of these terms and conditions or if Mondaq Ltd decides to terminate your license of use for whatever reason.

Use of www.mondaq.com

You may use the Website but are required to register as a user if you wish to read the full text of the content and articles available (the Content). You may not modify, publish, transmit, transfer or sell, reproduce, create derivative works from, distribute, perform, link, display, or in any way exploit any of the Content, in whole or in part, except as expressly permitted in these terms & conditions or with the prior written consent of Mondaq Ltd. You may not use electronic or other means to extract details or information about Mondaq.com’s content, users or contributors in order to offer them any services or products which compete directly or indirectly with Mondaq Ltd’s services and products.

Disclaimer

Mondaq Ltd and/or its respective suppliers make no representations about the suitability of the information contained in the documents and related graphics published on this server for any purpose. All such documents and related graphics are provided "as is" without warranty of any kind. Mondaq Ltd and/or its respective suppliers hereby disclaim all warranties and conditions with regard to this information, including all implied warranties and conditions of merchantability, fitness for a particular purpose, title and non-infringement. In no event shall Mondaq Ltd and/or its respective suppliers be liable for any special, indirect or consequential damages or any damages whatsoever resulting from loss of use, data or profits, whether in an action of contract, negligence or other tortious action, arising out of or in connection with the use or performance of information available from this server.

The documents and related graphics published on this server could include technical inaccuracies or typographical errors. Changes are periodically added to the information herein. Mondaq Ltd and/or its respective suppliers may make improvements and/or changes in the product(s) and/or the program(s) described herein at any time.

Registration

Mondaq Ltd requires you to register and provide information that personally identifies you, including what sort of information you are interested in, for three primary purposes:

  • To allow you to personalize the Mondaq websites you are visiting.
  • To enable features such as password reminder, newsletter alerts, email a colleague, and linking from Mondaq (and its affiliate sites) to your website.
  • To produce demographic feedback for our information providers who provide information free for your use.

Mondaq (and its affiliate sites) do not sell or provide your details to third parties other than information providers. The reason we provide our information providers with this information is so that they can measure the response their articles are receiving and provide you with information about their products and services.

If you do not want us to provide your name and email address you may opt out by clicking here .

If you do not wish to receive any future announcements of products and services offered by Mondaq by clicking here .

Information Collection and Use

We require site users to register with Mondaq (and its affiliate sites) to view the free information on the site. We also collect information from our users at several different points on the websites: this is so that we can customise the sites according to individual usage, provide 'session-aware' functionality, and ensure that content is acquired and developed appropriately. This gives us an overall picture of our user profiles, which in turn shows to our Editorial Contributors the type of person they are reaching by posting articles on Mondaq (and its affiliate sites) – meaning more free content for registered users.

We are only able to provide the material on the Mondaq (and its affiliate sites) site free to site visitors because we can pass on information about the pages that users are viewing and the personal information users provide to us (e.g. email addresses) to reputable contributing firms such as law firms who author those pages. We do not sell or rent information to anyone else other than the authors of those pages, who may change from time to time. Should you wish us not to disclose your details to any of these parties, please tick the box above or tick the box marked "Opt out of Registration Information Disclosure" on the Your Profile page. We and our author organisations may only contact you via email or other means if you allow us to do so. Users can opt out of contact when they register on the site, or send an email to unsubscribe@mondaq.com with “no disclosure” in the subject heading

Mondaq News Alerts

In order to receive Mondaq News Alerts, users have to complete a separate registration form. This is a personalised service where users choose regions and topics of interest and we send it only to those users who have requested it. Users can stop receiving these Alerts by going to the Mondaq News Alerts page and deselecting all interest areas. In the same way users can amend their personal preferences to add or remove subject areas.

Cookies

A cookie is a small text file written to a user’s hard drive that contains an identifying user number. The cookies do not contain any personal information about users. We use the cookie so users do not have to log in every time they use the service and the cookie will automatically expire if you do not visit the Mondaq website (or its affiliate sites) for 12 months. We also use the cookie to personalise a user's experience of the site (for example to show information specific to a user's region). As the Mondaq sites are fully personalised and cookies are essential to its core technology the site will function unpredictably with browsers that do not support cookies - or where cookies are disabled (in these circumstances we advise you to attempt to locate the information you require elsewhere on the web). However if you are concerned about the presence of a Mondaq cookie on your machine you can also choose to expire the cookie immediately (remove it) by selecting the 'Log Off' menu option as the last thing you do when you use the site.

Some of our business partners may use cookies on our site (for example, advertisers). However, we have no access to or control over these cookies and we are not aware of any at present that do so.

Log Files

We use IP addresses to analyse trends, administer the site, track movement, and gather broad demographic information for aggregate use. IP addresses are not linked to personally identifiable information.

Links

This web site contains links to other sites. Please be aware that Mondaq (or its affiliate sites) are not responsible for the privacy practices of such other sites. We encourage our users to be aware when they leave our site and to read the privacy statements of these third party sites. This privacy statement applies solely to information collected by this Web site.

Surveys & Contests

From time-to-time our site requests information from users via surveys or contests. Participation in these surveys or contests is completely voluntary and the user therefore has a choice whether or not to disclose any information requested. Information requested may include contact information (such as name and delivery address), and demographic information (such as postcode, age level). Contact information will be used to notify the winners and award prizes. Survey information will be used for purposes of monitoring or improving the functionality of the site.

Mail-A-Friend

If a user elects to use our referral service for informing a friend about our site, we ask them for the friend’s name and email address. Mondaq stores this information and may contact the friend to invite them to register with Mondaq, but they will not be contacted more than once. The friend may contact Mondaq to request the removal of this information from our database.

Security

This website takes every reasonable precaution to protect our users’ information. When users submit sensitive information via the website, your information is protected using firewalls and other security technology. If you have any questions about the security at our website, you can send an email to webmaster@mondaq.com.

Correcting/Updating Personal Information

If a user’s personally identifiable information changes (such as postcode), or if a user no longer desires our service, we will endeavour to provide a way to correct, update or remove that user’s personal data provided to us. This can usually be done at the “Your Profile” page or by sending an email to EditorialAdvisor@mondaq.com.

Notification of Changes

If we decide to change our Terms & Conditions or Privacy Policy, we will post those changes on our site so our users are always aware of what information we collect, how we use it, and under what circumstances, if any, we disclose it. If at any point we decide to use personally identifiable information in a manner different from that stated at the time it was collected, we will notify users by way of an email. Users will have a choice as to whether or not we use their information in this different manner. We will use information in accordance with the privacy policy under which the information was collected.

How to contact Mondaq

You can contact us with comments or queries at enquiries@mondaq.com.

If for some reason you believe Mondaq Ltd. has not adhered to these principles, please notify us by e-mail at problems@mondaq.com and we will use commercially reasonable efforts to determine and correct the problem promptly.