Here’s something I’ve learned after almost 20 years of being a lawyer—most people shouldn’t sue even if they have a good case. Why not? Because a lawsuit will usually take more time, money, effort, and aggravation than you expected, and result in a smaller recovery than you hoped–and that’s if you win! Here are eight questions you should think about before you head off to the courthouse to file a complaint.
1. Why do you want to sue?
Be honest with yourself; what’s motivating you to sue? Is it for strictly business reasons? If so, then you shouldn’t sue unless you’ll likely recover substantially more than the lawsuit costs. On the other hand, is it a “moral issue” to you? If so, you should think twice before bringing an action. Although you’re angry right now, are you still going to be “fighting mad” three years from now after tens of thousands of dollars of legal fees?
2. What do you want to get out of the lawsuit?
What—exactly—are you hoping to get if you win? Are you seeking money from the other side? If, so, how much? Are you looking for “specific performance” or “injunctive relief,” i.e., do you want the court to order the other side to do something or not do something? Or do you just want a “declaratory judgment” from the court resolving some legal question between you and someone else, e.g., determining what disputed language in a contract means? Simply put, if you can’t figure out what you want from a lawsuit, the court won’t do it for you.
3. What’s the best you can probably hope to get if you win?
As the Rolling Stones sang, “You can’t always get what you want.” So, before you sue, you need to take a hard long at what you could probably get when the lawsuit is finally over and won. This question has two equally important components.
First, what can you hope to get from the court? As an initial matter, no lawsuit or court order will be able to heal your heart or replace your most tragic losses (e.g., the wrongful death of a loved one). Beyond, that, you need to recognize that there is only so much that the court can do even if the judge and jury believe your side of the story. For example, the court won’t be able to force the other side to admit they’re wrong or apologize for what they did. It also won’t be able to force a company to fire an employee (e.g., the dog groomer who gave Scooter a horrible haircut).
No matter what the facts of the case, the court will only be able to grant you the legal “remedy” or “damages” allowed by law, and not every form of remedy or damages is available to the judge or jury in every case. For example:
- The type of action may limit your possible recovery. For example, in North Carolina, in an action for court ordered child support, the court cannot order the defendant parent to pay for college for children over the age of 18. However, that remedy (i.e., an order to pay for college) would be available if the action was to enforce a child support agreement that required those payments.
- A contract may limit your recovery. For example, what if the dry cleaner ruined your wedding dress? You could be surprised to find that under their contract with you, they are only required to refund the dry cleaning charge. Or what if you bought a bad part for your car (e.g., a faulty water pump), that destroyed your entire engine? The contract might limit you to only recovering the cost of the water pump.
- In most cases, you won’t be able to recover “consequential” or “special” damages. For example, say someone totaled your car and, as a result, you didn’t have a way to get to work for a week. Your lost wages would be “consequential damages” that you couldn’t recover.
- Finally, in most cases, you won’t be able to recover your attorneys’ fees or the costs of litigation.
You may be able to do a kind of “triage” to get a ballpark idea of your likely recovery. However, since your recovery is controlled by the specific area of law that applies to your case, you should seek advice from an attorney to help you determine your likely recovery. In my experience, the biggest mistake clients make is by ignoring their attorney’s warnings about what they are likely to recover (or, more importantly, what they aren’t likely to recover). In any event, once you’ve determined the best you can hope to get, you need to honestly compare it to what you want to get out of litigation. Simply put, if the court cannot give you what you want—even if you win—then you shouldn’t sue.
But your analysis can’t end with determining what award you might get from the court. As important (maybe even more important) is a hard look at what can you hope to collect from the defendant. At its simplest, every potential litigant should remember that old aphorism, “You can’t get blood from a turnip.” A Judgment is just a piece of paper. You can’t buy anything with it and it doesn’t guarantee you’ll ever get paid. So, a judgment for $1,000,000 is really worth nothing if the losing side doesn’t have any assets. In fact, it’s really worth less than nothing, because you’ll have had to spend time and money to get it. Again, if successful litigation won’t be able to get you what you feel you need, then you shouldn’t start a lawsuit.
4. How is the other side going to respond?
Even if you’re the one who starts the lawsuit, the case won’t be limited to just your claims against the defendant. That’s because, when someone (the “plaintiff”) sues someone else (the “defendant”), the defendant is allowed to respond by bringing any claims it has against the plaintiff (what are called “counterclaims”). In many cases, the defendant’s counterclaims can be larger than the plaintiff’s claims. For example, in one of my favorite cases, the plaintiff sued our client for about $500,000 in a complex contract dispute. Our client (the defendant) counterclaimed against the plaintiff. When the litigation was all over, the plaintiff wrote our client a check for $1,000,000. The kicker was that our client wouldn’t have sued the other company if that company didn’t sue them first. The possibility for counterclaims exists in most contract disputes, so potential litigants should think twice before they “kick the hornets’ nest.” by starting a lawsuit.
5. How much are you willing to put into the lawsuit?
If you’ve ever made a major purchase like a car, or a house, you’ve probably learned that it’s best to figure out the most you’re willing to spend before you go shopping. Otherwise, you’re likely to agree to something beyond your actual comfort zone and end up with buyer’s remorse. So, even before you go speak with a lawyer, you need to take a hard look at (i) your own finances and assets and (ii) how much the case is really worth to you. Based on that information, you need to then determine the maximum you’d be willing to spend on the case. (And when you’re making that calculation, you still have to remember that there is no guarantee that you’ll win your case or ever be able to collect on any judgment.)
But money isn’t the only thing you—the litigant—will have to put into the lawsuit if you sue. You also need to ask yourself how much time, effort, and irritation you’re willing to put into trying to win your case. Your attorney will constantly be needing documents and other information from you, often with very short notice, and delays in providing that information can seriously harm your case. Are you willing to elevate this matter to one of the top priorities in your life? The other side will also be allowed to ask you questions in writing (“interrogatories”), demand documents from you, and require you to testify under oath before trial (a “deposition”). You will be required to provide the documents and answer the questions even if you think the other side shouldn’t need the information. If you don’t, your case will be dismissed. Are you willing to provide documents and information to the other side and to spend a substantial amount of your time answering their questions?
Additionally, you have to understand ahead of time that it won’t be a quick ordeal. Even simple lawsuits usually take several months, with many lawsuits taking several years before they are fully resolved. There will be many ups and downs (and it will seem like more downs) along the way. At times, you will be scrambling to meet deadlines. However, at other times, you may have to make repeated appearances in court only to have the judge continue the case each time. It will be a long road and it will be frustrating. Looking forward, if you had to have put up with three years of that to get any recovery, will it have been worth it to you?
6. How much is the lawsuit likely to cost?
Obviously, this is a question you will need to discuss with an attorney. However, you should have given some serious thought to each of the five questions above before you ever consult with a lawyer. Understand that unless your lawyer agrees to take your case on a flat-fee (i.e., a fixed dollar amount, determined up front) or a contingency (i.e., a percentage of what you get from the case), he or she will only be able to give you their best estimate of how much it will cost. And that estimate will really be a “guesstimate” because lawsuits are unpredictable. It’s impossible to know ahead of time what your opponent, or the judge, will do. And because of the adversarial nature of lawsuits, the other side can drive up your costs (e.g., by fighting every little detail, delaying, and making unnecessarily burdensome discovery requests) even if your attorney is doing everything he or she can possibly do to keep costs down.
Because of that, the best that you are likely to be able to get from your attorney is a range of possible costs. Many potential clients often ask how little they might need to pay. That is probably the least important question to ask. (However, if that number is higher than what you want to pay, then you should absolutely walk away.) The two questions you should ask the attorney are: (1) what’s the most you think it might cost and (2) what do you think it will probably cost? If the damages that the court could award you would be less than the cost of litigation, you probably shouldn’t sue.
7. What is your likely “net recovery”?
In the final analysis, your “net recovery” is the number that really matters. Your net recovery is the amount you’ll actually be able to put in your pocket after you’ve paid your attorney’s fees and any other expenses related to the litigation (such as court costs, liens, taxes, costs of collection, etc.). Your likely net recovery is based on (1) your chances of winning, (2) your likely recovery if you do win, and (3) the likely costs to win. Of course, it’s impossible to know any of those things for certain before trial. So you (and your attorney) should be conservative in your estimates. The bottom line, though, is that you shouldn’t start a lawsuit unless your net likely recovery substantially outweighs the time, effort, and frustration of litigation.
8. Are there any better alternatives?
No matter what the numbers tell you, you also need to consider whether there are any better options. For example, your situation may be a good case for “alternative dispute resolution” through arbitration or mediation, settlement discussions, or even just a “demand letter” or phone call from an attorney. If none of those options will work, you should ask yourself one more question: “Can I afford to just walk away from this.” If you can, you probably should. But, if you can’t, then it’s probably time to get to work on preparing to file your complaint.
Of course, every case is different, and these eight questions only give you a very basic starting point to help determine whether you should sue. Before you actually commence any lawsuit (even what you think will be a small one), you should strongly consider discussing your case with an experienced trial lawyer who can give you a professional and unbiased assessment of your case and your options. And you should do that sooner rather than later because, if you wait too long, you may lose your right to bring your claims because of rules that limit your time to file a complaint (i.e., statutes of repose and statutes of limitation).
Keep one more thing in mind—I’m a litigator. It’s not just my job, it’s something I love to do. I want to try every case I can, but, more important to me, I want to make sure we do what’s best for the client. Sometimes—when there are no better options–that means suing and taking the case all the way through trial. But, before you choose to go down that road, you need to answer for yourself, “Do I really want to do this?” That can be a hard question to answer, but giving some serious thought to these eight questions will help you make the best decision.