LITIGATION PLAN: The Smart Alternative to a Tight Litigation Budget
Litigation budget is a key factor in client representation. A sound litigation budget makes it possible for lawyers to articulate a client’s goals and reach desired goals successfully.
There are several ways how a representation budget is prepared. Preparation is an essential part of litigation and strategy planning is the most important part of preparation. To reduce litigation cost, the budget must be prepared and planned by both the litigator and the counsel or the client.
Litigation budgets formulated at the beginning should be revised throughout the representation to reflect changes in the strategy. This is often done to make predicted costs more accurate however; it may limit the legal work needed for a quality legal representation.
But is quality representation always equal to high litigation cost? Not necessarily.
An alternative to the litigation budget is a written litigation plan. When making a plan, a client or corporate counsel should reduce those objectives to writing. The plan should state any particular legal issues that could have “precedential effect” for the client and the case (or a different case). It also should specify whether an early resolution is desirable, and if so, the plan to reach such an early resolution.
Alternative modes of dispute resolution should be considered (i.e., arbitration, settlement conference, mediation, etc.), in consideration of cost-effective measures and for litigation matter purposes.
In litigation, there are three basic cost points:
- legal research
- discovery
- trial/hearing/arbitration
The litigation plan should reduce to writing how these cost points will be managed consistent with the client's objectives.
A client should be required to approved costs of additional research or opt to limit motion practice while acknowledging other methods of resolving the case. Similarly, a client could elect to minimize the amount of discovery taken.
In addition, a well-designed plan should also include the total projected cost of litigation as well as projected costs of the basic cost points. The projection of cost has two purposes:
- To identify the area of high cost, thereby allowing strategies to reduce those costs
- to encourage an analysis of cost-effective business solutions
In short, we should consider whether litigation costs are more effective through strategy planning or through the financial budgeting process. Careful litigation planning guided by clients and counsel should be considered as an alternative method in reducing litigation costs.