What a contract lawsuit costs: one case, stage by stage
Owners ask what a lawsuit costs, and the honest answer depends on how far it goes. Here is one sample case, with where the money goes at every stage.
Every case is different, but the stages are the same, and so is the order in which money gets spent. Following one case through them shows where the decisions are.
The case
A sample: a mechanical contractor finished HVAC work on an office renovation and was owed $96,000. The owner said the system was installed late and refused the final payment.
Stage 1: the demand letter
A flat-fee letter citing the contract, the sign-off sheet and the payment terms, quoted before it goes out. No reply in thirty days.
Stage 2: filing suit
A complaint on the contract and a lien foreclosure. The owner answered and claimed $40,000 in delay damages. The fee for this stage covers the complaint and the reply to the answer; the court's filing fee is separate.
Stage 3: discovery
Each side produced documents and took two depositions. This is where most of the money goes: every document request and deposition adds attorney time, and the transcripts are a separate cost.
Stage 4: mediation
A half day with a mediator, whose fee the sides split. Our fee covers the preparation and the session. The case settled for $78,000, paid in thirty days.
The arithmetic
- Recovered: $78,000
- Fees: the four stages above, each quoted in writing
- Costs: the filing fee, the transcripts and half the mediator's fee
- Net to the contractor: what was left after fees and costs
Composite example. Your facts will differ, and past results don't predict yours.
What would have changed the math
An attorney-fee clause in the contract would have let the contractor ask the owner to pay its fees. Settling right after the answer, before discovery, would have saved most of the discovery stage's fees. Going to trial would have added far more, for a result no one could promise. Those are the choices the written plan puts in front of you, stage by stage.