Sunday 17 January 2010

Do lawyers milk it?

"An exact legal opinion on a claim could vary, depending on how expensive your lawyer is" - I read this recently (cannot now remember where) and thought, "How true!" Whatever the merits of a case, there will always be a lawyer willing to argue it - for a fee, of course.

In a number of cases, this seems to be just to make money or because the client insists. Two current examples:

1 Ms X's relationship with her partner broke down. She left the house he had bought and (as agreed at the outset) stopped contributing to the mortgage, etc. Despite the clear wording of the agreement they had both signed at the outset and despite the fact that my client has no money, her ex is trying to prove that she owes him for her perceived under-contribution to the household expenses, and his lawyers are writing unnecessarily complex and threatening letters to get her to pay what she does not owe and cannot afford. I have responded, pointing out that the best solution for both parties is to walk away from the collapsed relationship, but I suspect he will spend money on trying to prove he is right, even though it does him no good. Meanwhile, the lawyers are milking it

2 Mr Y had to liquidate his company two years ago when he realised he could not trade through a sudden difficult period. He is far and away the main creditor and has lost far more than all of the other creditors put together. Though the only money he took out of the company was reimbursement for proven expenses incurred on the company's behalf, he is being pursued by the liquidator, through solicitors, alleging fraudulent preference. Every few months, a letter arrives, claiming that some sequence of transactions or another is indicative of misuse of company funds. Each time, Mr Y and I go through the scant details supplied, he reaches deep into his memory and explains what he thinks the circumstances were, and I detail that to the liquidator's solicitors. It all then goes quiet but, just as I think I can archive the file, another set of accusations arrives. As far as I can see, the only purpose of this is to ensure that the liquidator's fees and his solicitors' swallow up all available funds and the creditors get nothing instead of 50% of what they are owed

A less cynical view, of course, is that lawyers are trained to consider every possibility, and as a result often make things more complicated than they need be - not deliberately or to make more money, but just because that's the way they are. Perhaps I should try to adopt this more charitable view

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