Although we are going to give you nine sure-fire ways to save money on legal expenses, it's critical that you first consider a couple of facts.

First, while it's important to be cost-conscious, you should also keep in mind that you often "get what you pay for." The cheapest product may not be the best. With the increasing government scrutiny of trade credit issues, competence and experience are a must. So, don't go looking for the cheapest council. Look instead for the best--and then use our nine strategies to minimize unnecessary charges and expenses.

Second, choose council that you can work with. Compatibility is essential; without it, you will never be able to maintain a satisfactory and efficient attorney-client relationship. If you have concerns about a case, whether with fees incurred, collectibility, or even how your directors will view the case status, you must be able to candidly discuss questions, concerns, and apprehensions with your legal counsel.

So, read on. These nine strategies will not only save you money, but also allow you to gain an important measure of control in the legal process.

One: Billing Statements
At a minimum, you should require a separate statement for each matter. This not only provides an easily understandable bill, but also allows you to distribute specific bills to others, which are more familiar with a particular matter, so they may review it.

Secondly, you should require itemized statements. These should include the following: the date of service; a description of what was done; time spent on each service provided; and the dollar amount charged for each service (hourly rate multiplied by time spent).

Nothing is more frustrating and bewildering than trying to figure out a billing statement that lumps together a variety of services and, at the end, places a dollar figure on the value of services rendered. Why should you have to guess what was done? This is the computer age, and most law firms have computer billing. A computer bill is only as good as the attorney who programs it, though. In other words, you can have any format you wish, if you require it. Remember, YOU ARE THE CLIENT. Full disclosure is not limited to the financial industry. You can require lawyers to comply as well.

Two: Standard Charges

Some firms have a standard minimum charge of ¼ hour or more for each phone call and ½ hour or more, minimum, for any correspondence. Fifteen minutes is a long time to talk, and with today's word processors, standard or form letters can usually be stored in memory.

Why not require the attorneys to bill in increments of 1/10 hour (six minutes) instead of 1/4 hour (fifteen minutes) and fractions thereof? Thus, a ten-minute call would be more accurately billed at .20 rather than a minimum of .25. The hourly rate assessed should cover the attorney's overhead for the cost of the call, etc. As for correspondence, similar requirements should be considered.

Three: Research
Most law firms are hired because of their expertise in a given area of the law. Extensive research of basic questions or issues should not be billed to you. If a law firm chooses to use an inexperienced lawyer to handle your case, that's their choice. You hired the law firm because of their knowledge and should not have to pay to train new employees.

Obviously, there are areas of law where research is necessary, regardless of expertise, and properly chargeable. In those instances, the attorney should clearly identify on the billing statement the areas requiring research.

Four: Document Preparation Charges
While it is appropriate for the attorney to charge for the time spent preparing a document (loan agreement, lawsuit, etc.), some attorneys also charge for the time spent by their word processing operator in typing the document. Major financial institutions refuse to pay these charges.

Five: Travel
Numerous airlines have early morning flights to accommodate the frequent flyer. If such flights are available, should the client have to pay for the hotel and meal expenses of the attorney who flies the night before for reasons of his own convenience? What about the attorney who charges portal-to-portal for his travel time to another city? Does this not encourage the use of local counsel to avoid the travel expenses? How about charging the client for mileage between two destinations, while they are also charged hourly for travel time? Is this overreaching? Acceptance of these practices should be made clear beforehand. You should establish a policy you feel is fair and communicate it to the attorney. If you are met with resistance, perhaps a local firm should be considered.

Six: Number of Lawyers
How many attorneys does it take to properly handle your case? This must be discussed and agreed upon. While multiple attorneys may be necessary in complex cases, generally, only one lawyer is necessary. Should you pay for supervision of junior lawyers by senior lawyers? Should you pay for new lawyers? If the firm does not have confidence in the lawyer chosen to represent you, it is their problem, not yours. Again, discuss the policy at the outset of the case.

Seven: Clerical Functions
Expenses, such as costs of filing, indexing, typing, standard postage charges, and secretarial overtime ordinarily should be a cost of doing business and built into the attorney's hourly rate. The policy regarding these expenses should be conveyed by the attorney.

Eight: Personnel Turnover
How often do you see a billing statement for "file review"? Like any industry, lawyers come and go and are always looking for better opportunities. While the law firm is left with the burden of having to reassign the case, why should you have to pay for a new attorney bringing himself or herself up to speed? While, on occasion, an artful lawyer may be able to disguise his billing entry and description when attorneys are replaced, assure yourself by confirming that you are not being charged for the newly assigned lawyer.

Nine: Guard Against Excessive Legal Fees--An Early Warning System
Require your attorneys to notify you whenever legal fees reach a certain plateau. In collection cases, a good benchmark is when fees reach 25 percent of the principal balance. Once notified, you can discuss the advisability and practicality of further expenses, the necessity for a budget, or other less expensive alternatives. While there will always be those cases where nothing can be done about limiting legal fees, at least you can be made aware of potential expenses for your own internal purposes. However, in many instances, a candid discussion may lead to the consideration of alternatives, which overall, may be in your best interest.

Don't forget to read the billing statements and ask questions. The credit department employee who is working with the attorney should have the opportunity to comment on statements prior to payment.

Let the attorney know what you expect. Do this at the beginning of the relationship so everyone understands your requirements and expectations. Above all, communicate with your lawyers. Let them know your concerns. After all, YOU ARE THE CLIENT!