Tips for Saving on Legal Costs (Part 2)

(This post is continued from "Tips for Saving on Legal Costs (Part 1)).

We previously talked about ways in which we can save on legal costs generally. Today, we will look at two (2) more general tips.

Tip 2: Ask for a Fee Range, not a Fee Cap

Most clients would ask for a fee cap (i.e. a single maximum fee which the lawyer can charge for the entire engagement – the engagement cannot exceed this figure). However, I find that in practice, if you ask for a fee cap, your actual bill will be very close to the fee cap. That is to say, if we hypothetically agreed to a fee cap of S$5,000, I would charge you S$5,000 for it, even though I managed to do the work within S$4,000.

Instead, I would suggest asking for a fee range. For example, instead of a fee cap of S$5,000, I want the lawyer to commit to a fee range of between S$3,000 to S$5,000 instead. In that way, there is some pressure on the lawyer to provide justifications if he/she charges in the upper limit of that range. If anything, it leaves you room to negotiate when you receive the final bill.

Tip 3: Baulk! And Ask!

Whatever fee range the lawyer first offers you, act shocked. Actually, depending on the law firm you have approached, you may not actually have to act – you will truly be shocked. Whatever it is, just remember to exclaim that the fee range is way too high and out of your budget.

Suggest a 10% discount immediately. In the current competitive climate, you could very well get the 10% discount immediately, without needing to provide any justifications.

If the lawyer refuses to budge, you could try signalling to him/her that you are in it for the long term – after this engagement, you may have other matters which require legal assistance. You are willing to refer future matters to the lawyer but only if a 10% discount is offered immediately.

Another strategy may be to do some market research first. Spend some time getting estimates of fee ranges from other law firms and do not be shy in playing them against each other.

[This series will be continued in the next post]

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