Do Business Well

At some point you may receive a bill for legal costs that seems staggeringly out of proportion to what you had originally envisaged. Unless you keep a close watch on the situation you may find that, having put a certain matter into the legal system, the various aspects that can be pursued soon add up to a heavy bill. Having started on this process, it may become difficult to back out, with the result that, what was at first deemed to be a fairly minor exercise develops into a campaign, each stage of which incurs more cost.

So, we should judge the merits of taking legal action or of using the services of the legal profession in the same commercial way that we would purchase other goods or services for the company. Unfortunately we don’t usually do this because we just don’t know what is going on behind the legal scenes. Consequently, we tend to accept professional charges as being fair for the job carried out, relying on the solicitor or lawyer to invoice according to the time and costs he incurs on our problem.

1. Use more than one firm of legal advisers

Some of your legal work can be done by local solicitors, whereas the more specialised work may have to be carried out by a large city firm. Generally, the bigger firms are more expensive so you could select your advisers according to the complexity of the task.

2. Educate your lawyer

The closer you are to your solicitor the more easily you can learn from him just what the legal steps he is taking for you imply in terms of costs. Some firms of lawyers seem to live in ivory towers so make an effort to get to know him better; this will certainly benefit you. Bring him to your office or works, show him round and encourage his interest in your firm generally.

3. Assess the fee implications of your instructions

If you are running your firm as financially effectively as you can, there can be few decisions made whose financial effects you do not consider. You should ask your lawyer what alternative courses of action are available to you and how much they will cost. Then you will be able to judge the cost-effectiveness of your decision.

4. Systemise your legal work

Some legal work (for example, the collection of debts through legal channels) can be systemised so as to reduce administrative effort in your firm and by your solicitor. Such streamlining of the routines could result in cost savings. If the information is prepared and presented clearly and concisely to your solicitor, then he may save his time and your costs.

5. Obtain estimates or quotations for legal work

By putting your legal work out for quotation you will very quickly identify cost savings. Also you will spot those firms who are keen for business, with the possible consequences that they may be able to act more quickly.

6. Check the reasonableness of your lawyer’s bill

Query his account as a matter of routine. It will show that you are keeping a check on his charges and may influence him towards keeping them as low as possible.

7. Negotiate lawyers’ bills

It’s really just straightforward good buying practice.

8. Analyse itemised legal bills

Legal work can be of varying complexity and can be carried out by junior or senior members of staff. So why pay a flat rate or a lump sum?

9. Authorisation of legal bills by head office staff

Branch or departmental staff may have a less inquisitive approach to legal bills. They could be mesmerised by legal jargon. Use your HO expertise and experience.

10. Independent checking of legal bills

Firms that have in-house lawyers often let the company lawyer agree the charges from outside firms. Let your purchasing director pass these bills through rigorous buying office routines.

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