Tucked into a list of 70 points on a checklist for outside counsel guidelines, published by the ACC Docket, March 2010 at 48-49, is the cautiously worded number 67: “Consider prohibiting your legal department’s responsibility for third-party invoices.” The author presumably would not have even mentioned the problem unless he believes that sometimes, after due consideration, a general counsel should absolve the department of responsibility to pay third-parties who have agreed to do something, such as for a law firm that billed the firm’s client (the general counsel). I guess that is the thrust of the “think about” point and the potential risk.
A law firm that represents you is your agent, and if your agent agrees to pay some third-party for a product or service, it seems to this lawyer manqué that you are legally bound. If you prohibit that possibility, your law firms might reasonably insist that all third parties they retain, such as car services, photocopy shops, messengers, temp agencies, and on an on either run a risk of non-payment or enter into contracts directly with you. What a waste. What am I missing about this mysterious prohibition?