Canadian Lawyer

lEgal rEport/liTigaTion "lawyers are afraid of numbers. understanding the numbers is really important today, because numbers are what drives business. you don't have to be a mathematician or an accountant — just having an ease with the basics is very powerful, and allows you to really address your client's needs in a way you can't if you're just focused on the legal material." MeLIssA LAfLAIr red pen is going through it and we're not paying for it." Such changes reflect the growing discontent in recent years among North American businesses over the cost of litigation, and the increasing demand by commercial clients for more certainty in legal budgeting. But how can lawyers prepare budgets with any accuracy when litigation, particularly trial work, is inherently unpredictable? "Ten years ago when times were booming, companies were less focused on all expense items," says James Doris, a commercial litigator and partner with Davies LLP in Toronto. "With the economy in the state it is, everyone's drilling down their expenses, and legal costs are for some companies a significant expense. They're trying to make sure they're spending their dollars wisely." Says Scaletta: "When a statement of claim lands on a CEO's desk, they and their CFO are increasingly going to ask, 'How much is it going to cost?' They're going to have that kind of hard discussion with whoever they hire. And 'shrug, I don't know, we'll bill you by the hour' probably isn't going to go over very well." It doesn't help that budgeting itself has always been an unhappy process for most lawyers. "Lawyers are afraid of numbers," says Melissa LaFlair, who has practised as both an in-house and outside commercial lawyer, and now runs a Toronto-based legal management consultancy. "Understanding the numbers is really important today, because numbers are what drives business. You don't have to be a mathematician or an accountant — just having an ease with the basics is very powerful, and allows you to really address your client's needs in a way you can't if you're just focused on the legal material." LaFlair says the best way for litigators to prepare — and adhere — to budgets is to approach cases with the same rigour and discipline as their commercial clients handle their own business: using a strategy broadly known as project, or process, management. In the legal world that means breaking down each case into distinct parts, and then A DAily Blog of CAnADiAn legAl news [ www.canadianlawyermag.com/legalfeeds ] 44 J u ly 2013 www.CANADIAN L a w ye r m a g . c o m analyzing the cost-benefits and pricing out each one. LaFlair advises lawyers to begin with a "file initiation checklist" that compels counsel, at the very start of litigation, to work closely with a client to understand their needs: What is their risk tolerance? Their overall business objective? Are they familiar with litigation or is this their first time? Do they understand the potential costs of going to trial? "Lawyers are not trained how to manage. They're trained how to analyze every possible risk," says LaFlair. "But in the real world, clients don't want you to identify every risk, they want you to identify what's relevant to their situation. My observation is that most lawyers don't. So drill down and focus on the core of the task at hand, which is why there should be a file initiation checklist — let's get this focused from the beginning." After zeroing in on business objectives, other experts say lawyers should ask clients to consider investing some money up front, on a detailed pre-litigation assessment. How many documents and witnesses might be in play? Are there class plaintiffs to be notified? Can the facts be verified? What are the strengths or weaknesses of claims? Are outside experts necessary? What is the litigation history of opposing counsel? What's the financial stability of the opponent? Such information can help determine how hard to fight, or whether PowereD By CAnADiAn lAwyer & lAw times

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