To ensure satisfaction to the client and payment to the lawyer, a lawyer must budget an engagement before starting …

If a tall skyscraper can be built under a fixed fee contract, clients frequently ask why the cost of  their “simple” matter can’t be estimated before beginning work. A lawyer generally responds that he/she doesn’t know enough to prepare an estimate of costs.

But, preparation of a budget is essential to starting and completing a legal matter in a way that ensures both client satisfaction with the process of working with a lawyer and payment in full, on time, to the lawyer. 

Budgeting begins by getting as much information as possible from the client about goals and expectations.  Information should cover parties, claims, anticipated strategies and desired outcomes, including whether a client prefers to go to trial or settle.  Understanding the client’s objectives is the prerequisite of the budgeting process. The key to preparing the budget is to  involve the client in the preparation.  The client should also formally approve the final budget. Without client buy-in, the process is meaningless.  A budget can only be an estimate of what’s going to happen and must be reviewed  periodically, with the client again accepting any changes that need to be made.  In billings to clients, they need to know how much they have already invested in the litigation, negotiation or transaction. This keeps everyone “on track” and informed. With such information always at hand, realization of payment is generally enhanced and the time between billing and payment shortened.


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