John Sturrock: What price a pound of flesh when the final bill comes in?

A recent story about a divorcing couple who have consumed nearly all of their multimillion-pound fortune in a bitter five-year court battle attracted special attention in the media because they were both practising solicitors.

The judge criticised them for “wrecking the ship of their marriage, then turning their attention to the lifeboats”.

By 2008, the couple had spent £879,000 on legal costs and contested proceedings. Since that time, the disputes and costs had continued, said the judge. It was a “catastrophe” for the family, including the three children.

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This may be an extreme example but it is not unfamiliar. Dickens wrote about it, and Abraham Lincoln said: “Discourage litigation. Persuade your neighbours to compromise whenever you can. Point out to them how the nominal winner is often a real loser – in fees, expenses, and waste of time”. Judges have all too often in recent years pointed out the disproportionate costs incurred by some parties in litigation.

There are at least three issues to consider here. One is the role of the courts in dispute resolution. For many, the courts are seen as a place of last resort. The question to address is whether this view should be encouraged even more by courts themselves. There is a respectable argument that, if parties wish to use courts to decide their disputes, it is not for the courts to interfere. However, in many jurisdictions, there is greater recognition of the need for courts and others to proactively inform disputants of alternative ways to resolve their differences, such as mediation, and to go further to discourage automatic default to the adversarial system.

The second issue is related to the first. Many protagonists have a natural desire for a judge to decide the rights and wrongs of their dispute. Initially, when emotions are high and costs relatively low, that can seem attractive.

Surely it is a sign of weakness to show willingness to reach an agreed settlement? And perhaps there is a legal principle to be resolved?

Unfortunately, over time, the financial, reputational, emotional and delay costs accumulate and consume many more resources than parties could ever have anticipated. Research and experience tells us that nearly all litigations eventually resolve out of court. But at what price?

This takes us to the third point. What is the role and, indeed, duty of lawyers acting for clients in these tough cases? Is it to do their best in court, whatever the financial and other costs, especially if the client is adamant about wanting his or her pound of flesh? What happened in that divorce case where legal costs mounted to the best part of a million pounds? In whose interests was that expenditure incurred? What advice was given – or rejected? We don’t know.

Many lawyers now understand the multifaceted nature of dispute resolution. It is about much more than legal analysis or the factual narrative, though these are important. Costs – direct and indirect – time, risk (not least what might happen in court), preservation of (or, at least, dignity in ending) personal or commercial relationships, publicity, stress, loss of morale, effect on others and so on. 

Skilled lawyers know how to help clients to analyse all of these factors to come to a sensible decision.

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Around the world, lawyers who act in this way are finding that they retain more clients and gain more referrals. There may be short-term losses in fee income in a particular case but, in the longer term, the gains are likely to be substantial.

• John Sturrock is the chief executive of Core Solutions Group