Discretional fees in business arrangements

Started by Martinus, October 12, 2012, 09:22:29 AM

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Martinus

This is especially addressed to lawyers but also to other people who participate in business negotiations, especially in services - how common is it in your country/culture to make business arrangements where the service recipient agrees to pay a certain fee but also agrees that if he or she is satisfied with the job you performed, he will pay an entirely discretionary bonus?

Just to clarify, this is not a success fee.

I'm asking because we have recently made such an arrangement with a client (i.e. they pay us a base amount of X, if the transaction succeeds they pay us an extra amount of Y, but if they are satisfied with the service, on top of X+Y, they will also pay us extra an amount they consider appropriate) and this is the first time I have encountered this but people who have made such arrangements with clients in the past have often been quite happy with it.

Tamas


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