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Shouldn’t law departments reciprocate prompt billing with prompt payment?

Clients rightfully want law firms to bill promptly. No surprise bills late in the year! No laggard invoices – management delayed is management denied.

That granted, chief legal officers can consider two techniques: (1) insist that law firms submit all bills within 30 days of the end of a month and (2) refuse to pay time recorded more than 45 days before the bill is sent.

Meanwhile, law departments ought to look in the mirror and ask why there is no corresponding commitment by them to pay promptly. One way to instill some discipline is to say “We will pay within 45 days or the discount granted by the law firm does not apply” (See my post of May 11, 2008: prompt payment with 10 references.).

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One response to “Shouldn’t law departments reciprocate prompt billing with prompt payment?”

  1. Steven Levy says:

    More and more (most?) corporations have a standard 60-day-pay policy, or a 2% 10 net 60 (we’ll pay 98% of the bill if you want the cash within 10 days; otherwise, we’ll pay it all 60 days out). It’s quite complicated in many places to enter special terms into the company’s A/P system. That said, the 60-day policy is very hard on small providers.