Legal services come at a price. Calculating that price might not seem a complex process but proper legal costs budgeting requires the measuring, weighing and balancing of a number of factors of equal or varying importance dependent on the circumstances of the case and persons that are party to the equation.
Whilst modern litigation continues to place its focus on time as its principal commodity, the reality is that time is just one of the factors that should be taken into account. As the client can be punished in costs by inefficiency, a lawyer can go equally unrewarded by expedition.
Differing levels of intelligence, a greater skill set or a better understanding of the law should be properly reflected in costs. It is just a fact that some lawyers are just brilliant whilst others stand in awe. Contrary to popular view, the hourly rate grading system does not come close to addressing this distinction but simply puts two lawyers with the same number of years served in the same price bracket regardless of whether one might actually be more intellectually gifted, an outright hard worker or a tactical genius.
Less obvious factors, but nevertheless important ones, include reputation or gravitas. Either could tip the scales of justice in their favour. What is a price for that?
The case itself could attract a level of importance whereby additional resources that otherwise might not be necessary should nevertheless be added to the budget to provide the maximum chance of success. We have seen a real life example of a client requesting more than £1 million extra resources being added to a budget phase as that client wanted to leave no stone unturned.
And then there’s value. A big ticket case surely justifies big ticket costs? High levels of complexity or novelty in law surely must also be reflected in the price.
Factors outside of the case and legal team could also influence a budget. By example a demanding and time consuming Client will drain resources as much as an inefficient team in the same way as a non-responsive or obstructive opponent.
Costs budgets are not simply an assessment of time and expenditure. They should properly reflect the value of the work for both parties to the retainer and properly reflect the circumstances of the case. Whilst a party can take a decision to fight, it can only take that decision with an awareness of potential exposure.
As costs budgets continue to play a significant role in litigation both between client and solicitor and between the parties, any budget presented must properly reflect costs that are both rewarding to the solicitor but also fair to the client and circumstances.