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Begin Web Based Questionnaire:

Position with Company:

Responsibility for Assigning Legal Work:

Years in Position(s) of Responsibility for Assigning Legal Work:

Approximate Number of Attorneys in Legal Department:

Nature of Company’s Business:

State or Country of Company's Corporate Headquarters:

NOTICE: This questionnaire’s purpose is to test a range of hypotheses about the value or relative value provided by in-house and outside transactional lawyers and to assess any transformation therein. By “transactional lawyers,” this questionnaire means lawyers involved in the negotiating and contracting process leading to closing a commercial, financial, or other business transaction. Please assume that all questions below pertain to those types of business transactions.

A.

1. In deciding which to use—in-house lawyers, or an outside law firm—as the primary lawyers on a business transaction, what considerations do you take into account (check all that apply)?:

1. size of the transaction
2. complexity or novelty of the transaction
3. riskiness of the transaction
4. perceived importance to senior management of successfully closing the transaction
5. anticipated legal expenses of the lawyers used
6. need for quality work
7. timely availability and responsiveness
8. other (please specify):

2. Of the considerations you checked, how would you rank them in degree of importance (“A” being most important, “B” being next most important, and so on)?:

• size of the transaction
• complexity or novelty of the transaction
• riskiness of the transaction
• perceived importance to senior management of successfully closing the transaction
• anticipated legal expenses of the lawyers used
• need for quality work
• timely availability and responsiveness
• other (if you so specified)

3. Which of the following factors help to explain why in-house lawyers may be a lower-cost provider, compared to an outside law firm, of transactional legal services (check all that apply)?:

1. using in-house lawyers reduces incidental costs (e.g., visits to the client, talking through issues)
2. using in-house lawyers eliminates the need to educate an outside law firm about your company’s organization and operations
3. in-house lawyers tend to close transactions more quickly than law firms
4. effective “hourly rate” of in-house lawyers is lower
5. in-house lawyer costs are less visible to senior management
6. other (please specify)

4. Which of the following factors help to explain why an outside law firm may be a lower-cost provider, compared to in-house lawyers, of transactional legal services (check all that apply)?:

1. law firms tend to have more extensive knowledge of transactional law
2. when they must educate themselves on a point of transactional law, law firms can apportion the cost of this educational process among numerous clients
3. hiring a law firm can make it easier to match the number of in-house transactional lawyers on staff with the fluctuating volume of transactional work
4. law firms tend to close transactions more quickly than in-house lawyers
5. where the other side pays your legal fees, it is more common to pay outside lawyer fees than in-house lawyer imputed fees
6. other (please specify)

5. How would you compare the trend in in-house transactional lawyer salaries with the trend in outside law firm billing rates for transactional work (check all that apply)?:

1. both are increasing at about the same rate
2. in-house transactional lawyer salaries are increasing more rapidly than law firm billing rates
3. law firm billing rates are increasing more rapidly than in-house transactional lawyer salaries
4. other (please specify)

6. Which of the following factors help to explain why in-house lawyers may provide greater benefits, compared to an outside law firm, as the primary lawyers on a business transaction (check all that apply)?:

1. in-house lawyers’ intimate familiarity with your company allows them to more quickly spot issues than outside lawyers
2. in-house lawyers are usually involved at a much earlier stage in the transaction than outside law firms and therefore can take a more proactive approach
3. in-house lawyers have a greater incentive to always ensure that your company is protected
4. in-house lawyers have greater expertise in certain types of transactions (specify which: )
5. in-house lawyers better understand the company’s “culture”
6. more timely availability and responsiveness of in-house lawyers
7. in-house lawyers have access to more and/or better resources (if you check this factor, please specify what resources):
8. in-house lawyers perform higher quality transactional work
9. other (please specify):

7. Which of the following factors help to explain why an outside law firm may provide greater benefits, compared to in-house lawyers, as the primary lawyers on a business transaction (check all that apply)?:

1. a law firm’s more extensive knowledge of transactional law may allow them to spot issues that could be overlooked by in-house lawyers
2. law firms have access to more and/or better resources (if you check this factor, please specify what resources):
3. lawyers at outside firms are more independent, and thus more objective, than in-house lawyers
4. lawyers at outside firms have greater expertise in certain types of transactions (specify which: )
5. law firms are specifically set up to get transactions done by having sufficient support staff (e.g., proofreading, photocopying, word processing, paralegals) to handle a large volume of transactions
6. more timely availability and responsiveness of lawyers at outside firms
7. lawyers at outside firms perform higher quality transactional work
8. other (please specify)

8. In-house transactional lawyer costs are (check all that apply):

1. less transparent to senior management than outside lawyer costs
2. as transparent to senior management as outside lawyer costs
3. absorbed in, or obscured by, other company costs
4. appropriately transparent to senior management

B.

1. In deciding whether to use in-house lawyers or an outside law firm as the primary lawyers on a business transaction, to what extent do you take into account the lawyer’s ability to observe and report potential misbehavior by company managers working on the transaction?:

1. to a great extent
2. to a significant extent
3. to some extent
4. to a small extent or not at all

2. Who can better observe misbehavior by company managers working on business transactions?:

1. in-house lawyers
2. lawyers at an outside law firm (hereinafter, “outside lawyers”)

3. Please explain your answer to the foregoing question:

4. Who is more likely to report misbehavior by company managers working on business transactions?:

1. in-house lawyers
2. outside lawyers

5. Please explain your answer to the foregoing question:

6. When using outside lawyers as the primary lawyers on a business transaction, to what extent do you also use in-house lawyers to monitor their work?:

1. to a great extent
2. to a significant extent
3. to some extent
4. to a small extent or not at all

7. In the context of the prior question, which of the following do your in-house lawyers monitor (check all that apply)?:

1. outside lawyer billing
2. progression of the transaction
3. level of protection provided to the company
4. other (please specify):

8. To what extent does reducing the number of outside law firms used for transactional work (“convergence”) reduce the need for in-house lawyer monitoring of law firms used in business transactions?:

1. to a great extent
2. to a significant extent
3. to some extent
4. to a small extent or not at all

C.

1. Approximately how many (significant) business transactions on average does your company engage in annually?:

2. Approximately what percentage of your company’s in-house lawyers spend all or substantially all of their time on transactional legal work: %.

3. Who handles repetitive transactions more efficiently, taking into account quality and cost?:

1. in-house lawyers
2. outside lawyers
3. it depends on the nature of the transaction

4. Please explain your answer to the foregoing question:

5. Who handles non-repetitive transactions more efficiently, taking into account quality and cost?:

1. in-house lawyers
2. outside lawyers
3. it depends on the nature of the transaction

6. Please explain your answer to the foregoing question:

7. Where a third party is expected to pay your company’s transactional legal fees, how likely is it that they would agree to pay your company’s in-house lawyer imputed fees (assuming in-house lawyers act as the primary transactional lawyers)?:

1. very likely
2. somewhat likely
3. unlikely

D.

1. How much government regulation is your company subject to (compared to companies generally)?:

1. much more than average
2. somewhat more than average
3. about average
4. less than average
5. little or none

2. To what extent, if any, are your in-house transactional lawyers more familiar than your outside lawyers with the regulatory issues that impact your company’s transactions?:

1. much more familiar
2. somewhat more familiar
3. equally familiar
4. less familiar
5. it depends (please explain):
   

3. If you answered (a) or (b) to the foregoing question, to what extent does that greater familiarity enable the in-house transactional lawyers to handle transactions more efficiently than outside lawyers, taking into account quality and cost?:

1. much more efficiently
2. somewhat more efficiently
3. not necessarily more efficiently
4. it depends (please explain):
   

4. How complex is your company’s organization and operational structure (compared to that of companies generally)?:

1. much more complex than average
2. somewhat more complex than average
3. about average complexity
4. less complex than average

5. To what extent, if any, are your in-house transactional lawyers more familiar than your outside lawyers with issues of your company’s organization and operational structure that impact your company’s transactions?:

1. much more familiar
2. somewhat more familiar
3. equally familiar
4. less familiar
5. it depends (please explain):
   

6. If you answered (a) or (b) to the foregoing question, to what extent does that greater familiarity enable the in-house transactional lawyers to handle transactions more efficiently than outside lawyers, taking into account quality and cost?:

1. much more efficiently
2. somewhat more efficiently
3. not necessarily more efficiently
4. it depends (please explain):
   

7. Approximately how many outside law firms, overall, does your company use for transactional work?:

8. To what extent could your company, by reducing the number of outside law firms used for transactional work, achieve greater parity between in-house and outside lawyer familiarity with regulatory, organizational, and operational issues that impact the company’s transactions?:

1. to a great extent
2. to a significant extent
3. to some extent or not at all

9. Has your company already reduced the number of outside law firms used for transactional work to try to achieve that parity?:

1. yes
2. no

E.

1. Who are more responsive to your company’s timing requirements in business transactions?:

1. in-house transactional lawyers
2. outside transactional lawyers
3. about the same

2. Who are better able to communicate with your company’s management in business transactions?:

1. in-house transactional lawyers
2. outside transactional lawyers
3. about the same
4. it depends (please explain):
   

3. Check all of the following that describes your company’s in-house transactional lawyers:

1. they are located in the corporate headquarters and have regular (formal or informal) contact with senior management
2. ­ they are located in the corporate headquarters but have little contact with senior management
3. they are located in regional offices and have regular (formal or informal) contact with management at their locations
4. they are located in regional offices but have little contact with management at their locations

4. Are in-house transactional lawyers typically more involved in structuring your company’s business transactions than outside lawyers?:

1. yes
2. no
3. it depends (please explain):
   

F.

1. To what extent does using outside transactional lawyers enhance your company’s reputation in a transaction (“reputational value”) more than using in-house lawyers?:

1. to a great extent
2. to some extent
3. to some extent
4. it depends on the transaction

2. Why might outside transactional lawyers provide greater reputational value than in-house transactional lawyers (check all that apply)?:

1. outside transactional lawyers are independent, whereas in-house transactional lawyers are employees of the company
2. outside transactional lawyers are, on average, more qualified than in-house transactional lawyers for the work they do
3. outside transactional lawyers may be no more qualified, but reputational perceptions change slowly
4. other (please specify)
   

3. Why might outside transactional lawyers, on average, be more qualified than in-house transactional lawyers for transactional work (check all that apply)?:

1. outside transactional lawyers are, on average, smarter than in-house transactional lawyers
2. outside transactional lawyers are, on average, better legally educated than in-house transactional lawyers
3. outside transactional lawyers see the type of transaction more often
4. other (please explain):
   

4. To what extent are you able to compete with outside law firms in hiring the best lawyers for your in-house transactional staff?:

1. to a great extent
2. to a significant extent
3. to some extent
4. to a small extent or not at all

5. If you answered (a), (b), or (c) to the foregoing question, what may explain your ability to compete?:

1. higher compensation paid to lawyers on your in-house transactional staff
2. lower stress/better lifestyle of lawyers on your in-house transactional staff
3. more flexible hours available to lawyers on your in-house transactional staff
4. other (please explain):
   

6. To what extent do you hire outside transactional lawyers in business transactions simply because other parties request legal opinions of your independent outside lawyers?:

1. to a great extent
2. to a significant extent
3. to some extent
4. to a small extent or not at all

7. When a third party requests a legal opinion in a business transaction (on matters other than corporate housekeeping), how often will that party accept an opinion issued by your in-house transactional lawyers?:

1. almost always
2. often
3. occasionally
4. rarely

G.

1. To what extent does the attorney-client privilege help facilitate your company’s business transactions?:

1. to a great extent
2. to a significant extent
3. to some extent
4. to a small extent or not at all
5. the attorney-client privilege works against facilitating transactions (for example, by increasing information asymmetry among transaction parties)

2. How does the in-house attorney-client privilege compare to the attorney-client privilege created by using outside transactional lawyers?:

1. in-house privilege is much weaker
2. in-house privilege is somewhat weaker
3. in-house privilege is about the same
4. in-house privilege is somewhat stronger
5. in-house privilege is much stronger

3. All other things being equal, would you consider hiring an outside law firm to handle a “sensitive” transaction simply to take advantage of the stronger (or perceived stronger) attorney-client privilege?:

1. yes
2. no
3. possibly

H.

1. Approximately what percentage of your company’s business transactions are currently lawyered primarily in-house?: %.

2. If the current percentage is less than the percentage of your company’s business transactions that you would like to see lawyered in-house, what accounts for the discrepancy (check all that apply):

1. difficulty in matching number of in-house transactional lawyers on staff with fluctuating volume of transactional work
2. outside law firms have the expertise necessary for complex or unusual transactions
3. third parties sometimes insist that your company uses an outside law firm
4. other (please specify)
   

3. How does the percentage of business transactions currently lawyered in-house compare with the percentage lawyered in-house ten years ago?:

1. currently much lower
2. currently slightly lower
3. currently about the same
4. currently slightly higher
5. currently much higher

4. Please comment on the following proposition: “There has been no transformation in the inherent value provided by in-house and outside transactional lawyers. Rather, the shift from outside to in-house transactional lawyers has been occurring because burgeoning legal costs have made companies more sensitive to legal bills. At the same time, transactional legal work has matured and become more straightforward and companies have grown and engage in repetitive transactions, making it more feasible to bring legal work in-house and save costs.”
Your comments:.

5. Are there any other factors, not mentioned in this questionnaire, that might explain the shift from outside to in-house transactional lawyering or a transformation in the value or relative value provided by in-house and outside transactional lawyers?:

6. To the best of your knowledge, would you answer any of the questions in Parts A-G of this questionnaire differently if you were responding 10 years ago? If so, please explain (ignore questions that ask for specific numbers):

7. Please try to answer the preceding question as if the reference to “10 years ago” read “20 years ago”: