Hidden Costs Of Litigation

Most people should know that when they instruct a solicitor, it will cost them money. Solicitors charges are either calculated by way of a fixed fee, a percentage of damages or the estate, or by reference to time spent multiplied by an hourly rate. In addition, clients may be asked to pay for something called disbursements - fees paid to other people, usually experts, or court fees etc.

But litigation has further costs involved. When people ask me what are the chances of success, I normally tell them you have a good or bad chance, but litigation is uncertain. Why is this? Surely the law is straightforward? Guess again.

If a case goes to trial there are all sorts of things that can and will go wrong, not least you get the wrong Judge. Judges are supposed to be unbiased and fair but with the greatest respect to Judges, they have political views and opinions just like you or I.  One District Judge in the Midlands area still favours the solicitor firm where he undertook his training many moons ago, a Judge somewhere in the north clearly dislikes female advocates. I once lost an argument based on the fact that my argument was based on evidence from a barrister who practiced law in a rival chambers to that in which his daughter was a tenant. Some Judges are pro-claimant, others are pro-defendant.

Legal Lottery

So this then brings me on to the hidden costs.

These hidden costs of litigation affect businesses and people involved in litigation. They may not show on a business balance account in the same way as legal charges do, but they show in other ways:

• Time spent worrying
• Time spent by companies dealing with the dispute
• Sleepless nights
• Time spent providing and collating evidence, or attending solicitors
• Consequent disruption and possible loss of overtime/revenue/income
• Emotional strain and potential ill health
• Potential loss of business

The above is a bleak list, and so it is vital that when contemplating litigation, to collect and record as much information as possible. If you have had an accident, take photos as soon as possible of the accident site and injuries; if it is business related get as much information as possible about the dispute and the opponents finances and assets so that firstly your solicitor has sufficient information, and secondly, so you are not paying your solicitor to do this work at £180 per hour or so. And finally - choose a good firm of solicitors - not necessarily the cheapest, as the difference between a good solicitor and a bad one is the difference between a win or loss, or £1000s in compensation.