Law departments may establish budgets for specific matters handled by outside counsel. However, many times in-house counsel call a partner for short or general advice. Those calls can mount up to significant bills and it makes sense to budget them.
Doing so, however, raises issues of whom to hold accountable for the budget if many lawyers can pick up the phone for the firm. Further, there can be several general accounts for a large law firm if several practice groups call it for advice.
One solution places accountability for the budget on the relationship lawyer in the department who oversees that firm (See my post of May 18, 2007: inside lawyer appointed for each major firm.). That person should monitor use of the firm on general questions and the retainer agreement (See my post of Jan. 7, 2008: retainer billing at Harvard Pilgrim; and May 21, 2007: matter budgets with 9 references.).