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Case for fixed fee model

Lack of legal clarity due to ‘mismatch of expectations’

Keith Anderson

Keith Anderson: not a new phenomenon (pic: Terry Murden)

One of Scotland’s leading corporate lawyers says a lack of transparency in fees and advice offered to SMEs – identified in a report this week – is a result of a “mismatch of expectations”.

Keith Anderson, chief executive of Vialex, said this was “nothing new”. His firm recognised this some time ago and has adopted a fixed fee model for over 10 years to ensure both parties know what to expect.

He was reacting to research commissioned by Morton Fraser, which said law firms were guilty of a lacking clarity in the services provided to smaller firms. Chief executive Chris Harte called it a “wake-up call” for the sector.

However, Mr Anderson said: “This lack of clarity and SMEs feeling vulnerable is not a new phenomenon, though it is perhaps surprising that it is still the case.

Mr Anderson, who set up Vialex with a former Dickson Minto colleague Keith Dinsmore, added: “When we set up the business we recognised that there was a need to provide certainty and clarity of service and cost.”

“The problem often is that there is a mismatch between the client’s expectations and the lawyer’s understanding of what it is they are being asked to do.

“Of fundamental importance is a detailed understanding to the client’s needs and a full and open discussion between the client and the lawyer as to what the potential problems might be.

“Too often the profession will pitch too low in the hope that ‘it will be all right on the night’, and it rarely is… We prefer to say it as we see it by providing a fixed price from which we will not move.

“Investing time and energy to understand the client’s business reaps rewards for both sides.”

He said that while many firms offer to do certain types of work for a fixed fee it is not most firms’ preferred starting point.”

On comments made by Prof Lorne Crerar, chairman of Harper Macleod, that Scotland’s legal sector was in danger of losing its identity, Mr Anderson said: “We live in an increasingly international environment and I do not share concerns about a loss of independence.

“As long as we have world class universities producing talented students trained in Scots law, and a strong underlying economy, then there will always be a need for Scottish legal advice. Ownership is of less importance.”

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