Four simple ways to save on legal costs

Protect yourself before you start

It's simple and something that many contractors, architects, and even some owners don't want to do: speak with a lawyer. Informal agreements, working off of bid documents, a handshake or a quick email all sound great. They keep everyone happy and excited and get the project under way. It seems like a proven formula when many of the projects work out without the headache of additional paperwork and expenses. However, it only takes 1 in 20 or 1 in 100 to ruin a business and even long-term relationships when projects and expectations go sideways. Just like seeing an accountant before filing taxes is better than receiving an audit by the IRS after filing, seeing a lawyer before the contract is signed or a dispute erupts is almost always smarter and less expensive than a drawn-out battle later on.

The reality is that the relatively small expense one pays for a lawyer to review the contract and agreements is well worth it. Any delay or nervousness a contract review might bring to a client may save its business and preserve a working relationship. The contract is the base of the agreement and allows both sides to make sure they understand each other's goals and expectations for the project. These varying expectations don't always rear their head until the budget limit has been reached or the project is far along, making any correction difficult to swallow for either party.

While a good attorney will cost a bit up front, his or her expert guidance can save a client from fines, expenses, and even lawsuits. The attorney can ensure that a firm is not unknowingly doing something illegal, providing proper notices, in possession of the right government certificates or requirements, and aware of any agreements' risks and expectations so that they don't overly outweigh any profits or insurance coverage.

Organize to save time and money

When a legal issue arises or concern grows that one is on the horizon, the easiest and most important step one can take to reduce a legal bill is to become organized. I know it sounds simple, but one can save hundreds to thousands of dollars on the first meeting with an attorney by making sure documents are in order.

Make a folder that includes the following sections in chronological order by party: (one section for each subcontractor) the contract, project documents, change orders, payments (including requests, rejections and invoices) and any correspondence. At the very least, have the contract, payments and change orders in order and easily producible. This will save you a charge of the hourly rate for someone else to put them in order, or a charge for essentially wasting time searching through documents while the attorney or legal staffer is speaking with you.

The lawyer may require additional and/or more detailed information, but this is a solid starting point to evaluate a case and risks.

Don't wait

The longer that one waits before seeking advice, the more costly a fix can become. Whether it is timing requirements for lien rights, payment disputes or correctly following contractual requirements, the longer the delay, the less time exists to address the issue before filing formal legal papers or losing certain remedies.

Lien claims have specific filing and notice requirements that if not followed exactly will waive one's ability to use them to ensure payment. Delay of payments can cause interest to accrue, making matters more expensive by each passing day. Often, but not always, it is better to pay up to the amount in dispute and not just fail to pay completely.

Finally, in early stages tempers are lower and misunderstandings can be rectified. There are more tools to negotiate with and facilitate dialogue.

Hire someone that knows your business

There are many lawyers that are general practitioners who are good at what they do, but it's worthwhile to find out what their backgrounds and undergraduate degrees are. Experience in your industry is an added bonus. Experts are often used and needed at trial to testify. Although anyone can hire an expert to explain the issues, someone from within the field can uniquely understand concepts, language and practices that take actual knowledge or many years practicing to understand. Does the person know what a slurry wall is, critical path, or how onerous a difficult punch list can be? These are some additional areas that take additional time, experts and fees on learning before litigation.

This industry knowledge will save money and time when negotiating settlements and understanding the issues at hand. Additionally, this specialized insight can help in understanding answers and exploring questions during depositions or trial that those without such experience may not understand in the heat of the moment or without the use of a costly expert weighing in.

In summary, the most important things to do are: get advice before a problem erupts, organize files, obtain assistance promptly and hire someone who will understand the issues. Implementing these tips will help save money, time and additional headaches. Remember that each case is unique and will require specific advice, but by using these tips, one will be able to reduce overall legal costs.

-----

Cameron Anderly is the founder of Anderly Advocates. He focuses his practice in construction and business transactions and litigation. Contact him at 971-238-4046 or anderlylaw@gmail.com.

Published: Thu, Mar 19, 2015

Comments

  1. No comments
Sign in to post a comment »