- Matt Sanderson
What Makes Restaurant Litigation So Darn Expensive?
We get this question quite a bit. There’s a dispute. Our restaurant client knows they are right. The restaurant wants a quick result and wants it done inexpensively. What in the world is takes so long or costs so much? Shown below are some answers to this question and some ways to reduce your litigation costs.
Here is a helpful restaurant analogy for litigation. Imagine you are in your restaurant. The customer orders a pizza. You make the pizza, meet the customer’s order, and the customer pays the price on the menu. Simple, right?
Now imagine the same situation. However, also imagine that as you make the pizza, there is someone else in the kitchen hindering your progress. For each topping you add, they try to take a topping off. You set the oven; they turn it off. You roll the dough; they tear it apart. And on, and on, and on.
In this last situation, how in the world are you going to set a price for the pizza? After all, you do not know how long it is going to take you to avoid all of the hindrances from the other person. Heck, you may not even be able to make the pizza. Still, you’re going to do all you can, but it may take twice the ingredients you thought in the first place.
This is a close analogy to what happens in litigation. Each time your attorney makes progress for you, the opposing lawyer or even the court can cause impediments. This back and forth, this fight, is what causes the costs of litigation to spiral. As professionals go, this dispute process is really unlike almost any other discipline. For instance, your accountant often does not have an opposing party that works against them when they prepare your taxes. Similarly, doctors do not have another party that continues to intentionally make you ill when the doctor tries to heal you.
Issues That Contribute To Expense
Aside from just the constant impediments from the opposing party and the court, there are a number of other factors that lead to litigation expense.
Clear Facts. One factor is the nature of the case, meaning whether the facts are clear or murky. Clear facts can make litigation less expensive, but unclear facts that result in lots of competing opinions on those facts can be very expensive.
Expert Witnesses. Another factor is the need for experts. Often, an expert is needed to make an opinion on some issue in a case. For instance, in a restaurant construction dispute, an expert might be needed to determine if the restaurant was constructed properly. That expert can be costly, but more than that, the other party will also obtain their own expert. Now both sides of the dispute must battle each other and the opinions of the other side’s expert. That leads to lots of lawyer time and client expense.
Time And Discovery. Time and the discovery process are yet an additional factor in litigation expense. The longer the case drags out, the more expensive it will be. The main factor in the length of a case is what we call “discovery”. Discovery is just the term lawyers use to obtain all of the facts or documents about a case. If either party wants to withhold key facts or documents, it takes a lot of lawyer time to force the other side to produce those facts. Often, these facts and documents win lawsuits, so the lawyers often battle over which facts and documents are really relevant. The longer the battle, the more expensive the case becomes.
Possible Ways To Reduce Litigation Expense
A fight is a fight, and no two fights are really exactly the same. The longer the fight, the more it takes to win. In litigation, that translates into money. Still, there are ways to reduce these expenses.
Hourly Rates. One way to reduce expense is to pay attention to hourly rates. The lower the hourly rate, the less over all the fight can cost.
Limit Issues. Limiting the issues is another cost saver. If you have, for instance, five things to dispute, but only three of those issues are really worth the fight, you can decide to only fight about those three issues that really matter.
Avoid “He Said, She Said.” Avoiding the “he said, she said” fights can also save costs. Any time that the dispute involves two conflicting opinions that cannot otherwise be proved, it will be more expensive than those disputes where you can prove what happened in some other way. For instance, a dispute over whether you paid rent is likely to be less expensive than a dispute over whether someone said your employee insulted them.
All in all, litigation is expensive, as shown above. However, you can keep the costs down by knowing what drives litigation expenses and using the above methods to reduce them.
Have you been through a lawsuit? How bad was it? Please let us know!
About the author: Matthew Sanderson is a restaurant lawyer in Texas. “Good service with a smile” is his motto.