This document discusses five ways to make litigation cheaper. It begins by defining litigation and discussing risk management strategies like clear terms and conditions, insurance policies, and appointing a risk manager. It then covers engaging solicitors efficiently by preparing documents yourself and keeping solicitor time minimal. Alternative dispute resolution methods like mediation and arbitration can help settle disputes cheaper than going to trial. The document ends by noting the biggest cost drivers in litigation like poor disclosure management and unrealistic approaches, and recommends settling early, agreeing to mediate, focusing on proportionality over principle, preparing well yourself, and using litigation funding options.

2. five ways to make litigation
cheaper
Presented by
Chris Greenwell
Claire Herbert
29 May 2012

3. before the event
the pre-litigation process
litigation itself

4. what do we mean by litigation?
• This presentation is about commercial civil
disputes
• Disputes which are argued about
• Few businesses plan to be involved in
litigation
• Make sure the risk of it is managed

5. risk management

6. risk management
• Terms and Conditions
• Before the event insurance
• Credit insurance
• Risk manager
• Clear audit trail in contact with suppliers and
customers

7. terms and conditions
• Have terms and conditions of sale
• Have terms and conditions of purchase
• Make sure they are incorporated and prevail
• Keep a clear record of the contracting
process
• Make sure the terms
• Maximise exclusions
• Clarify recoverable consequential loss
• Have them reviewed regularly

8. before the event insurance
• Surprisingly cheap
• e.g. £150.00 premium for £50,000 worth of
cover
• Masses of providers - 4m Google ‘hits’ in
0.29 secs
• Can be tailored to your particular business
• Gives massive leverage in negotiation
• A matter to refer to your insurance broker
• Don’t be left saying ‘If only if…..?’

9. credit insurance
• Minimises risk
• It imposes discipline in contracting
• It does not eliminate litigation which is usually
required to be pursued
• Be selective about your credit insurance
provider
• Ensure the conditions are observed. Many
will decline on the flimsiest pretext
• The message to your opponent is you will not
give up

10. risk manager
• Not ‘rocket science’
• Someone responsible for documenting
contracts and agreements
• Management of insurances and terms
• Collation of evidence and documents
• Management of e-communications
• Takes overall control of disputes

11. clear audit trail with suppliers and
customers
• The biggest problem for clients in disputes is
lack of records
• This is easy to fix, it just needs priority
• Responsibility should be delegated to risk
manager
• All verbal communications on the issue
should be followed up in writing
• All meetings should be minuted
• Some record is better than no record if
pressed for time

12. a few home truths

13. a few home truths
• It is always better to settle than fight
• Even success at trial is rarely a full ‘win’
• ‘If in doubt leave it out’
• Except ‘without prejudice’
• Always build in ‘kentucky windage’
• Don’t leave it until the last minute
• ‘It is a matter of principle’; consign it to the bin

14. going to the solicitor
• key tips on engaging with the solicitor

15. engaging the solicitor
• Remember litigation solicitor’s bill by time
• Not to ‘milk’ clients but because it is difficult to
estimate something that may be over in a
week or may be over in years
• Keep solicitor’s time to a minimum
• Do preparation on the facts yourself

16. engaging the solicitor
• Send your solicitor a detailed statement in
advance
• Cross index it with key obvious documents
• Limit calls, limit emails, limit letters
• Solicitors are required to give estimates.
Make sure you have one and keep track of it
• Costs significantly exceeding estimate may
not be payable

17. the pre-litigation process

18. protocols
• Claims and defences to be exchanged by
letter
• Disclosure of relevant documents must be
given
• Objective is to foster settlement
• Parties required to consider alternative
dispute resolution
• Cost penalties for not observing the rules

19. alternative dispute resolution
• You interacted with your opponent. Meet
them ‘without prejudice’
• Part 36 offers
• Calderbank offers
• Mediation

20. mediation
• Mediator is honest broker
• Parties meet on one day
• Their polarised positions are exchanged
• Mediator negotiates to bring parties together
• Worse case and best case scenarios are
compared
• Contractual deal is reached on the day

21. mediation
• Deal never the best but must be capable of
‘being lived with’
• Costs massively less than litigation
• Court cannot yet force parties to mediate
• Increasingly there are cost penalties for not
mediating (court’s require explanations for
refusal)
• Overwhelmingly the swiftest and easiest way
to save legal costs

22. mediation
• See my dreadful home video on the subject at
http://sodiesha.re/ojp/YNS
• Leave your card for a free emailed guide to
mediation

23. other forms of alternative dispute
resolution
• Arbitration
• Adjudication
• Non-monetary agreements
• Pay what’s obviously owed

24. the litigation itself
• Funding
• Legal expenses insurance
• ‘Conditional fee’ or ‘No win, no fee’
agreements
• Hybrid agreements
• New regime pending
• Government keeping it a secret
• See my blog http://wp.me/p1Jm7L-2z
• Regime better suited to claimants acting
against insured defendants
• ATE insurance and third party funding

25. counsel and assistants
• Closest comparison of counsel and solicitors
is to consultants and GPs
• Question indiscriminate use or worse total
reliance
• Experienced solicitors should only use
counsel in more complex or unusual cases
• Find your solicitor’s opinion

26. counsel and assistants
• Find why your solicitor needs to go to counsel
• Ask ‘don’t you know the answer?’
• Unnecessary use can easily add one third the
cost of a claim
• Solicitors like to delegate. Not everything
needs lots of experience
• Make sure this does not mean you pay twice
or worse for a team of people

27. the start of proceedings
• Make sure you get the claim documents right
first time
• Avoid your solicitor trying the case in wordy or
lengthy correspondence
• Security for costs
• Summary judgment
• Interim payments
• Take a practical view. What the rules allow
and what is cost effective are not the same

28. disclosure
• Must be thorough
• Risk manager should marshall emails
• They should be stored in folders by subject or
sender
• They should be sent to solicitor in
chronological order in zip files by subject or
recipient
• Big email cases that are not controlled by
client hemorrhage costs

29. disclosure
• Judges hate it and bad management means
potentially massive irrecoverable cost
• Be practical about trying to find non existent
documents

30. witness statements
• This is a series of stories about the events in
the case
• Write the first statements right at the start of
the case (when your memory is fresh)
yourself
• Credibility comes from detail
• Avoid numerous travelling drafts
• Be wary of counsel examining every last word

31. experts
• Expert issues are matters where the judge
needs guidance on what is or is not right
• If it is that sort of case they cannot be
avoided
• If you are confident; get your expert report
early and avoid getting to the stage where
they are being exchanged

32. experts
• Consider the possibility of a single expert or
narrowing areas of real dispute
• Two expert cases add very substantially to
costs in reports, meetings and attendances at
trial.

33. trial
• This is the most expensive part of the case
• It is also the part of the case where it is really
hard to save cost (cheaper counsel the only
practical choice)
• It is absolutely full of risk on costs, part 36,
experts, facts, law and the vagaries of the
judge

34. so where do the costs ramp up?
• Solicitor undertakes factual preparation for
the client
• Solicitor places excessive reliance on counsel
• Disclosure is mismanaged
• Client contacts excessively and unnecessarily
with Solicitor
• Unrealistic approach to settlement and merit
of the case

35. so, the five best ways to cut
costs?
• Settle early and don’t forget the managerial
downtime
• Always agree to mediate; you’ve little (especially
in big value cases) to lose
• Forget ‘principle’ and don’t lose sight of
proportionality
• If you must fight, work hard on your own
preparation and set the opponent up with offers
• Try and ‘lay off’ your legal costs; CFA, hybrid
CFA, BTE insurance

36. questions