In the future, law firms will be required to provide witness statements, pleadings and discovery schedules on computer disks. That is the growing feeling among City firms, which are installing the latest computer technology to support litigation cases.

Litigation is a paper-intensive process, where the benefits of computerisation are most immediate to the client, according to Jonathan Maas, a litigation support expert with the City firm Lovell White Durrant. "If you can produce a detailed analysis at the touch of a button, in response to the other side's allegations, the client will be impressed," he says.

Graham Smith, head of litigation at Bird and Bird, who specialise in intellectual property and telecommunications, says that corporate clients already make technology a determining factor in their decision to hire a firm.

Recently, representatives from the pharmaceutical and banking industries were invited to speak at a seminar organised by the Society for Computers and the Law. Their organisations make heavy use of computer systems, and have most of their supporting documentation on disk.

Many expressed the view that they would like their lawyers to be freed from the mundane tasks of document searching, in order to concentrate better on the merits of the case. Computerisation should improve the chance of winning a case by giving lawyers a better grasp of the facts.

Mr Smith acknowledges that many firms will express doubts about such claims, but he warns: "The litigation partner who is sceptical of technology can't remain a sceptic when the client hands over a data disk."

The Serious Fraud Office has already indicated to leading criminal law firms that it wants to exchange documents on disk in selected cases. "If the prosecution wants to supply us with evidence on disk, then having the technology in place gives us a competitive advantage," says Tony Sacker, the IT partner with the criminal law firm Kingsley Napley.

Mr Smith believes that computerised litigation support is no longer just for the large commercial law firms. Advances in technology, combined with the falling cost of hardware and software, mean that it is now accessible to all firms. In the mid-Eighties, when Lovell White Durrant and Bird and Bird first computerised litigation cases, the systems ran on expensive mainframe computers. Today, a suitable system can be designed to run on a relatively low-cost personal computer network.

Computers assist fee-earners prepare a case by improving access to all sources of information. They are better equipped to piece together the story, and also have the right tools to devise a strategy for the case, and communicate it to the client.

"Computer support helps lawyers to simplify the strands of the case and develop an overview," says Mr Maas. "And it can enable the grasping of issues that the human mind may well fall down on."

Mr Smith highlights the preparation of the list of discovery documents, traditionally done with a typewriter or word processor. But the changes to the list become laborious as documents are added and withdrawn, and if the work is done by lawyers, it becomes expensive.

In his view, this process is one where the benefits of computerisation can be enjoyed by small and large firms alike. His approach is to index the documents in a database, and when changes are made to the discovery list, the database automatically alters the numbering.

Fee-earners at Bird and Bird have direct access to the database from personal computers on their desk. They can, for example, search for all documents of which a particular witness is the author. The firm also has the facility to scan documents into the computer. The advantage of scanning is that documents can be accessed instantly - instead of hauling out box files, the fee earner can call up the image of the relevant papers on the screen.

In addition, the scanned documents are portable. They are stored on CD-Rom (compact disk, read-only memory), with one disk storing 100,000 pages of A4. It is therefore possible to carry the entire case documentation to court, even in the largest cases.

Scanning, however, is expensive, and is unlikely to be of benefit in every case. Firms may prefer to buy a small scanner for in-house use, and use a bureau for those cases which warrant the expense, and where the client is prepared to foot the bill.

The main benefit of scanning is that lawyers can use the power of the computer for full-text searching - checking all the documents for information that may not have been found manually. This requires an optical character recognition (OCR) scanner. Experts, however, take the view that OCR is not particularly effective. It works well for typed or printed documents where the text is clearly legible, but fails on documents which are handwritten or faded.

"It is not possible to use OCR for the vast majority of litigation cases," Mr Maas says. "Words have been encircled, notes appended, or the document is a fifth-generation copy." On the other hand, full text searching is viable where the documents were generated on a computer, and are already in digital form - for example, correspondence originated in-house on a word processor.

Another problem presented by this is charging. "It is a very difficult issue and I don't think anyone has got to the bottom of it," says Mr Sacker. The present system of hourly rates will not be tenable where computers cut down the time spent on each case, and it is more likely that the charges will depend on how much the client is willing to pay for the anticipated benefit.

Clients can be billed directly for some aspects, such as the scanning of documents. But the key decision is whether to charge a premium for new technology, on the grounds that there is a better chance of winning the case, or whether to regard the computer system as a means of bringing in extra business that will make up for the loss in hourly fees.

There is also debate about whether the costs of computerised litigation support should be paid for by the Legal Aid Board. George Ritchie, the board's legal adviser, says it regards computer equipment as an overhead, rather than a disbursement. It is possible, however, that the use of a bureau service for scanning documents could be regarded as a disbursement.

Firms would need to apply for prior authority, and so far, says Mr Ritchie, he is not aware of any that have done so.