Casual legal: Litigation can be costly

By Justine Fay
Reynolds Mirth Richards Farmer LLP
Alberta Municipalities Casual Legal Service Provider

Litigating disputes before the courts can be a costly. Aside from legal fees, there are a number of less obvious costs involved, such as:

• Labour costs. Employees will have to meet with lawyers, gather and review documents, prepare to be questioned under oath, attend that questioning, travel, prepare for trial, attend trial, and so on. This could amount to several hundred hours that could otherwise be spent on other matters.
• Energy. Litigation is stressful, adversarial, and complicated. This can cause morale to dip and adversely affect employees' job satisfaction.
• Time. It can take many years for a claim to work its way through the system. For municipalities, there may be an entire new council, administration, and employment roster by the time the dispute reaches trial.
• Optics. The municipality may receive negative media coverage and public criticism over the course of the litigation.

When a municipality finds itself involved in litigation, there are a number of strategies it can use to mitigate against the above costs. Where it is practical and sensible to do so, one cost-effective option is to enter into a settlement agreement.

Parties can agree to settle at any point in the litigation, whether it is before pleadings have even been filed or in the hallway of the courthouse before trial. The first step is to make an offer. In doing so, the municipality should get creative. What does the other side really want? Is it money, or something else, like an apology?

Your lawyer will usually communicate the offer to the other side with a deadline for responding. The other side can either accept or reject the offer. They can either reject it outright, or present the municipality with a counter-offer. If the latter occurs, it will be the municipality’s turn to decide whether to accept it, reject it, or present a further counter-offer.

Ideally, the parties will be able to reach a negotiated settlement. When the final offer is accepted, the lawyers will prepare the settlement agreement, releases, and discontinuances of the claim(s). Your lawyer will also help facilitate the movement of any settlement funds between the parties.

If the parties are unable to reach an agreement, litigation will continue and you will be able to explore other options for a cost-effective resolution. One option is to pursue alternative dispute resolution processes, such as mediation or arbitration. Another strategy is to bring summary judgment or summary dismissal applications, which allow the court to resolve the dispute based on affidavit evidence instead of conducting a full trial. Your legal counsel will be able to advise on the strategy that has the highest chance of success in your circumstances.

To access Alberta Municipalities Casual Legal Helpline, Alberta Municipalities members can call toll-free to 1-800-661-7673 or send an casuallegal [at] abmunis.ca (email) to reach the municipal legal experts at Reynolds Mirth Richards and Farmer LLP. For more information on the Casual Legal Service, please call 310-MUNI (6864) or send an riskcontrol [at] abmunis.ca (email) to speak to Alberta Municipalities Risk Management staff. Any Regular or Associate member of Alberta Municipalities can access the Casual Legal Service.

DISCLAIMER: This article is meant to provide information only and is not intended to provide legal advice. You should seek the advice of legal counsel to address your specific set of circumstances. Although every effort has been made to provide current and accurate information, changes to the law may cause the information in this article to be outdated.