5 Ways to Effectively Reduce the Cost of Litigation

by William Dickerman, Esq.

 

     If there's one thing we can all agree on, it's that suing and being sued isn't cheap. The most gung-ho plaintiff can quickly become cowed by a couple of meaty attorney invoices; the most die-hard defendant, who "won't give an inch," may soon be offering feet and yards. Lawsuits are not for the faint-hearted. Even well-healed parties can feel poor in the maelstrom of legal battle. Yet, as Ecclesiastes suggests, there is a time to sue and a time to be sued. King Solomon might have added some of the methods that the combatants can minimize the bloodletting. Here are five ways to effectively reduce the cost of litigation:

 

1. Stay out of litigation.

     This is not to be glib. It's easy to get yourself or your business in a legal pickle; it takes some effort to stay above the fray. But it's well worth it. One practice you would be well-advised to institute is to behave in good faith and with good cheer, since people tend not to sue people they like or they feel are dealing fairly with them. Another valuable exercise is to keep good records of transactions, such as correspondence, invoices, canceled checks, and photos of property damage. The person who has the evidence is most likely to avoid a lawsuit, or prevail if he (includes "she") finds himself in one. 

2. Choose the right lawyer.

     Your decision is critical because the quality of legal services ranges wildly (compare Atticus       Finch/Gregory Peck and "My Cousin Vinny"/Joe Pesci). The right attorney will advise you of your legal rights and obligations, and counsel you about your options and the ramifications of following one road or another to your destination. Take, for example, a hot-headed client who demands that a suit be filed immediately because he is so enraged about what the bad guy did to him. Presumably, the client counts on his attorney to be cool-headed and objective. While most are, many are not, and they might be inclined to follow the client's marching orders rather than offer the sage but unpopular counsel that is needed. The difference in the client's cost of waging the litigation can be enormous. The right lawyer might have advised cost-conserving steps such as a cooling-off period, engaging in mediation, or informally contacting the other side's counsel. Since most people do not want to be a party to a lawsuit, such preliminary efforts often bear fruit. It is usually worth the limited expense of such efforts to avoid spending heaps of money unnecessarily. 

Business male saving money into piggy bank 3. Work closely with your lawyer.

     He should invite your participation, since you know more about the facts and your goals than he ever will. Avoid the lawyer who says, "Leave it to me," or, "I'll let you know how it turns out." You should welcome the collaboration because success in litigation is often the result of sound judgment, and the product of two good minds is better than that of one. That should lead to a speedier resolution and reduced cost. The collaboration should also force the attorney to plan ahead and to explain his course of action in advance, to allow sufficient time for your input. For instance, he might propose taking several expensive depositions that you would like to avoid. Together you might determine that that discovery is not so important, and that less pricey means are available to achieve the same goal. If you leave the question of tactics and cost to the attorney's sole judgment, you could be unpleasantly surprised by the subsequent invoices. Over the course of litigation there are many opportunities to limit and expand activities and thus expense: Your close participation in the case will maximize your ability to minimize them. A major bonus is that your personal satisfaction will likely increase as your participation does. 

4. Litigate aggressively.

     It might seem paradoxical to propose spending big bucks in order to reduce costs. But it really isn't. An aggressive party (usually the plaintiff) wants to impress the other side with his conviction and commitment, if only to make him fearful about hemorrhaging legal fees. While bursting out of the gate costs a lot, the price will be worth it if your opponent folds because he isn't so committed and doesn't think the fight justifies his cost. That's when settlement talks might begin. If you want to be taken seriously, instruct your lawyer to fight aggressively from the git-go. And if you have to go to trial, you'll have the confidence of being prepared. 

5. Look for opportunities to end the lawsuit. 

     Clients often erroneously believe that once they are parties to a lawsuit they are committed till the bitter end. That is rarely true: 95% or more of cases are dismissed or settled without trial. If a reasonable settlement is your goal, rather than extracting a pound of flesh at trial, then you should let your attorney know that, so he can test the waters at opportune times. You'd be amazed at how quickly the most intractable foes can lay down their swords and shields when the time is right. Keep your mind and eyes open to those times.

     You can see how easily legal fees and expenses can get out of hand. What good will it do you to spend, say, $100,000, to collect a debt of $90,000? To avoid such "victories," always monitor the expenses, and adjust strategy and tactics accordingly. Unless you do, you may end up winning the battle only to lose the war.

 

William Dickerman, the principal attorney of Dickerman & Associates, has been litigating business, real estate, and other commercial and personal lawsuits for over 30 years in and around Los Angeles. For more information, go to www.dickermanlaw.com. This article is not meant to constitute legal advice; please consult and rely only on competent counsel after a thorough review of your individual circumstances.

© William Dickerman 2015 - All Rights Reserved.