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3 Steps to Reduce Your Legal Bills by 33%

August 7, 2012
The key to reducing your overall legal bill(s) – without sacrificing the quality of those legal services – is to take control of your own legal problems and solutions.  Far too many clients allow their lawyer(s) to control the initial “rules of engagement”, resulting in a very unlevel and costly playing field.  By taking control at he beginning of the process, the client can ensure the best representation at the best price.  When done well, this process will result in significant savings.
  1. Select the right attorney(s):  Choosing the right attorney may be the most important factor of all – and the most difficult.  Generally, a specialist or more experienced attorney – who will likely be more expensive – is the better choice.  For an example, see here.  Once you identify an attorney with the requisite skill, the next and very crucial step is to determine whether this attorney will become your partner – or see you as his next victim.  As I have discussed previously (based on the ideas of Richard Burcher and others), the best attorney-client relationships balance the needs of the client with the need of the attorney to make an honest living.
  2. Implement a client-friendly retention agreement:  While your attorney is supposed to owe the client the highest fiduciary duty, in many states, this duty doesn’t begin until after the attorney is retained, i.e., after the retention agreement is executed.  What that means in practice is that most attorney-client retention agreements are very client unfriendly.  Don’t let your attorney control these negotiations.  These are your legal problems and you need to be negotiating terms that work best for you.  Trust me, it’s unlikely that your attorney is going to sign a bad deal, but he will definitely let you.  A client-friendly agreement will include some or all of the following (for hourly billing in a litigation setting):
    • Litigation Management Guidelines that must be followed.  For an example, see here.
    • Hard Budgets – many attorneys will give low-ball estimates to get the client to sign a retention agreement.  These are generally not contractually enforceable.  Instead, require real budgets that have to be met.  The client must approve any deviations from the budget.
    • Require monthly bills that follow the litigation management guidelines.
    • Require client approval of all billings, including an informal dispute resolution process, i.e., mediation, for any disagreements.
  3. Closely monitor and manage the legal work:  No matter how well the Retention Agreement is negotiated, unless it closely monitored by a person with the requisite understanding and experience for the matter being litigated, most if not all, of the potential savings will be given back to the attorney(s).  It is imperative that each bill be fully discussed with the attorney and understood by the client before final approval is given.  At this time, overall strategy will be better understood between the client and attorney and appropriate decisions for future strategy can be made.

Implementing these 3 steps will result in significant cost-savings to the client while maintaining, if not increasing, the quality of those services.  A smart client will understand that the attorney’s needs must also be part of the process.  While an overly pro-client stance may offer greater short-term savings, in the long run it will be unsustainable and will eventually result in a lesser quality of legal services.

While the above principles are being discussed in the hourly billing context, they would also be relevant to alternative fee arrangements (beyond the scope of this post).

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