Using Fee Structures

A fee structure is a reusable billing arrangement, where more than one matter may use the same structure. A fee structure specifies how a client expects to be billed for similar matters. It includes a general description of the work to be performed, the area of law, what fee types will be used (flat fee, detailed hourly, etc.), stages (milestones) for the work, identification of who makes fee offers and if client approval is required for offers.

After the fee structure is created, it is applied to the appropriate matters. If a corporate customer has many types of matters, then many types of fee structures may be created.

When a law firm makes an offer, and it is approved by the client, the law firm is eligible to work on all matters that use the same approved fee structure. The rates on the offer will apply to all such matters until the law firm makes a new offer and the corporate customer approves it.

 

Types of Fee Structures

The most common type of fee structure is "Detailed Hourly.” This fee structure asks firms to enter the hourly rates of each member of the firm that will work on a given matter. Other types of Fee Structures include a "Contingency" fee structure used generally in insurance defense. A "Flat Fee" structure is generally used in transactional matters, i.e. patent procurement. An example is shown below.

NOTE For general information about offers and rates, see overview. To make an offer, see steps.