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Aligned Incentives and Cost Control

How structural fee design affects litigation behaviour.

Published: 7 July 2024   |   Reviewed: 3 September 2026  
(3-minute read)

The Incentive Question in Litigation

In most civil litigation, lawyers are remunerated either:

  • on an hourly basis, or

  • under conditional cost agreements tied to outcomes.

Under hourly structures, fees usually increase as more work is done.
When settlement work and trial preparation are performed within the same retainer, financial incentives and early resolution do not always point in the same direction.

This is not a question of integrity.
It is a question of structure.

Clean Law uses a different structure, designed to make cost, funding and approval points easier to see and manage as a matter progresses.

Related public guide

Clients often assume cost disclosure means cost control.
But being told is not the same as being able to stop.

Read: Knowing what may happen does not always give you control

Clean Law’s Structural Incentive Design

Clean Law’s structure has three parts:

  1. Defined fees for settlement and escrow work

  2. Separation between settlement and trial advocacy

  3. A results-based bonus linked only to avoided trial costs

Each mechanism affects behaviour in a specific way.

Alignment One: Defined Fees and Escrow Oversight

Clean Law charges fixed or staged fees for managing the defined work, with any results bonus limited to avoided trial costs recorded in the agreed escrow budget.

Since Clean Law does not earn trial fees:

  • delay or expanding trial work does not increase Clean Law's agreed settlement and oversight fees

  • unnecessary trial spending may reduce any results-based bonus

  • any results-based bonus depends only on avoided trial costs, not damages, settlement money or any court recovery

Escrow requires client approval before funds are released and before new stages begin.

This places cost authority with the client rather than inside the billing structure.

See Escrow and Switching Flexibility for operational detail.

Alignment Two: Separation of Roles

Clean Law does not conduct contested hearings, draft pleadings for filing, or brief counsel in substantive litigation.

Those functions are performed by the client’s separately retained courtroom lawyer.

If a matter proceeds to trial, the trial lawyer earns the trial fees.

Clean Law does not.

This structural separation removes Clean Law’s financial incentive to recommend litigation for trial-fee revenue.
(See Advocacy Boundaries & Independence Policy for scope limits.)

Alignment Three: Results-Based Bonus Linked to Avoided Trial Costs

Clean Law earns a results-based bonus only if settlement avoids trial costs recorded in the agreed escrow budget.

The bonus is not a percentage of damages, settlement money or any court order.

If no trial costs are avoided, no bonus applies.

This means:

  • early resolution aligns with our remuneration

  • delay does not increase our fee

  • escalation does not increase our fee

In practical terms: Clean Law is not paid more because the court case grows.

Why These Mechanisms Matter

Taken together, these safeguards mean:

  • settlement incentives and remuneration move in the same direction

  • trial advocacy remains independent

  • early trial preparation cannot begin without client approval

  • funds remain visible and controlled through escrow

  • mobility between courtroom lawyers remains intact

Cost management comes from structure, not assurance.

Bottom Line

Two-lawyer representation may reduce avoidable overlap where settlement work and trial preparation would otherwise blur.

The objective is not to criticise existing legal-service structures. It is to provide a staged arrangement where:

  • delay does not increase Clean Law’s settlement and oversight fee

  • contested court work does not create trial-fee revenue for Clean Law

  • early resolution can align client and Clean Law interests

This does not make litigation cheap, simple or risk-free. It is designed to make incentives, roles and funding decisions clearer before further work is approved.

By Nicky Wang
Principal Solicitor