What “Best Interests of Our Client” Actually Means in Litigation

Most lawyers will tell you they act in their client’s best interests. It’s a standard line.

But what does that actually mean when you’re sitting across the table from a liquidator demanding $500,000, or staring down a two-year battle that will cost you more than the dispute is worth?

It doesn’t mean fighting every case to the death. It doesn’t mean settling everything to avoid court. It means something more nuanced, more strategic, and infinitely more useful.

Let me show you what it looks like in practice.

What Acting in Your Best Interests Actually Involves

Here’s what most people think it means: their lawyer fights as hard as possible to win the case.

And that’s part of it. But only part.

Acting in your best interests means taking into account your actual objectives, not just the legal ones. It means understanding what success looks like for you, commercially and personally. It means advising on the various risks of litigation, weighing up the strengths and weaknesses of your case, and being honest about what those mean in dollar terms and timeline terms.

It means you go to a mediation with a detailed understanding of your own case. Not just “we think we’ll win” but “here are the three issues that will decide this, here’s how strong we are on each one, and here’s what it’s worth if we’re right.”

And because of how litigation-only firms like ours structure pricing, it means knowing exactly what it will cost to run the matter to a contested trial. Not a range. Not “it depends”. An actual number.

That certainty changes everything.

The Commercial Reality Test

For defendants in insolvency cases particularly, acting in your best interests also means having frank discussions about the commercial impact that ongoing litigation will have on your business.

Not just the legal fees. The management time. The distraction. The stress of two directors spending half a day every fortnight in conference calls when they should be running the business. The emotional weight of knowing a lawsuit is hanging over you for the next eighteen months.

Some disputes are worth that cost. Some aren’t.

That may mean coming to an agreement with the liquidator to put an end to the litigation early, to produce a better net position for you commercially, even where running the matter to trial is a viable alternative and you’d likely succeed.

Let me give you a real example.

Defending an Insolvency Claim: A Case Study in Strategic Settlement

We recently achieved a very successful outcome for a client, a subcontractor in the construction industry, at mediation defending an unfair preference claim.

The liquidator was seeking repayment of funds our client had received in the six months before the head contractor went into liquidation. The claim was substantial. Our client had been paid for work genuinely performed, and the amounts were legitimate. But the law on unfair preferences doesn’t always care about fairness in the everyday sense.

We negotiated a payment by our client to the liquidator of less than 10% of the amount of the original claim.

Now, could we have won that case outright at trial? Possibly. We had strong arguments around good faith and ordinary course of business. But here’s what we also knew: running it to trial would take at least twelve months, involve significant legal costs (even with cost certainty), and require our client’s directors to spend substantial time on the dispute rather than on keeping their own business afloat in a tough construction market.

The liquidator, for their part, faced litigation funding costs, the risk of losing entirely, and pressure to get cash back to creditors sooner rather than later.

A settlement at under 10% of the claim amount meant our client could draw a line under the dispute, pay a manageable sum, and move on with their business. The emotional relief alone was worth more than the settlement figure.

That’s what acting in their best interests looked like. Not “winning” in the courtroom sense. Winning in the sense that mattered to them.

Why Liquidators Settle (And When They Don’t)

Understanding the other side’s drivers is half the battle. Liquidators aren’t pursuing these claims out of spite or vendetta. They’re doing it because they have a statutory duty to maximise the return to creditors.

But they’re also running a commercial operation. They have to weigh the cost of litigation, the time value of money, and the risk of losing against the prospect of recovering the full amount. Most liquidators are funded by litigation funders who take a significant cut of any recovery, which changes the settlement math considerably.

If you can make the liquidator see that the likely return after trial, after costs, after funder’s cut, is not materially better than settling now, you shift the calculus.

That means being smart about how you position your defence, what evidence you lead early, and what signals you send about your willingness to go the distance.

Being Smart and Strategic Lawyers: The Dual-Side Advantage

When it comes to insolvency proceedings, litigation-only firms who regularly act for both sides, for liquidators and trustees and for defendant companies and individuals, are in a uniquely powerful position to navigate the mediation process.

Why? Because we have in-depth insight into the key drivers for a liquidator and can make informed strategic judgments on the likely course of the litigation.

We know what a liquidator is thinking when they see certain defences raised. We know which arguments will make them dig in and which will make them reconsider. We know the pressure points that will assist a defendant client to increase the likelihood of the liquidator wanting to settle the claim.

And we know what a liquidator’s lawyer will be advising them about costs, funding, and risk.

That dual-side experience isn’t theoretical. It’s practical, immediate leverage in every negotiation.

Pressure Points That Shift Settlement Dynamics

Here are the levers that matter in insolvency disputes (and most other commercial litigation):

Strength of your defences raised early. If you can show the liquidator within the first two months that you have well-evidenced defences that will require them to run a complex trial, you’ve changed the risk calculus.

Cost certainty on your side, uncertainty on theirs. If you know exactly what trial will cost you and can demonstrate you’re funded and ready to go, that’s a powerful signal. Meanwhile, the liquidator may be dealing with litigation funders who will withdraw if the case looks harder than expected.

Timeline pressure. Liquidators often have reporting obligations to creditors and to ASIC. Delays look bad. A defendant who is clearly prepared to litigate for two years without blinking can use that to advantage.

Realistic without being weak. There’s a fine line between showing you’re open to settlement and signalling desperation. Walking that line requires experience and judgment.

Commercial context. In preference claims, showing that you acted in good faith, in the ordinary course of business, and without knowledge of insolvency can shift settlement discussions even if those defences aren’t slam-dunks at trial.

Advising Confidently on the Merits of Both Sides

We are well versed in the law when it comes to insolvency cases, so we can confidently advise on the merits of both parties’ positions and help both liquidators and defendants reach the outcome that is best for them.

That confidence comes from repetition. When you only litigate, when you’ve run dozens of preference claims and defended dozens more, when you’ve sat through mediations where the other side raised arguments you’ve personally run in other cases, you develop judgment.

You can tell a client: “Here’s where you’re strong. Here’s where you’re vulnerable. Here’s what the other side will argue, and here’s how we’ll respond. And here’s what I think happens if we go to trial.”

That clarity is worth more than any single hearing win.

The Three Questions You Should Be Able to Answer

If your lawyer can’t answer these three questions clearly, something is wrong:

What are the two or three issues that will decide this case? Not ten issues. Not “it’s complicated”. Two or three.

What’s our best-case outcome, worst-case outcome, and most likely outcome? And what are the odds of each?

What will it cost to get to each stage (mediation, trial, appeal), and when will we know more? Actual numbers. Actual dates.

If you can’t get clear answers to those questions, you’re navigating blind. And that’s not in your best interests.

When Settling Is Smart (And When It Isn’t)

Let’s be clear: settlement isn’t always the right answer.

Some cases need to be fought. Some principles are worth defending. Some claims are so weak, or so inflated, that caving sends the wrong message and invites more trouble down the track.

But the decision should be made strategically, not emotionally.

Settle When:

The cost of fighting exceeds the value of winning. If defending a $100,000 claim will cost you $120,000 in legal fees and management time, and you’ll only recover half your costs even if you win, settling for $40,000 starts to look smart.

The emotional and business toll is too high. Some disputes poison relationships, distract management, and create stress that flows through your entire organisation. If settlement lets you move on, that has value.

Your risk of losing is real. Even if you think you’re more likely to win than lose, a 40% chance of a catastrophic loss may not be a gamble worth taking.

The other side has made a genuinely reasonable offer. If a liquidator comes to the table early with a sensible compromise, recognising the weaknesses in their own case, you should take that seriously.

Fight When:

The principle matters more than the money. Sometimes a dispute is about setting a precedent, protecting your reputation, or sending a message to other potential claimants.

The other side is bluffing and you can prove it. If you have the evidence to demolish their case and the cost of doing so is manageable, don’t settle out of fear.

Settlement sets a bad precedent. In some industries, if you settle one spurious claim, five more will follow. Sometimes you fight the first one to deter the rest.

You’re defending your integrity. Claims that impugn your honesty or competence can’t always be settled with money. Sometimes you need the vindication of a judgment in your favour.

The Emotional Cost of Litigation (That No One Talks About)

Here’s something most law firms won’t tell you, because it’s not billable and it doesn’t fit neatly into a retainer agreement: litigation is exhausting.

Not just financially. Emotionally.

The stress of not knowing when it will end. The frustration of waiting six months for a hearing date. The anger at having to defend yourself against claims you know are wrong. The anxiety of gambling your business on a judge’s decision.

That cost is real. And it should factor into your decision-making.

We’ve had clients who won at trial, recovered most of their costs, and still said afterwards: “I wish we’d settled earlier. It wasn’t worth it.”

And we’ve had clients who settled early, paid more than they wanted to, and said: “Best decision we made. We got our lives back.”

Acting in your best interests means weighing all of that. Not just the legal merits.

How Litigation-Only Firms Structure Outcomes Differently

Here’s a structural advantage that matters: when you work with a litigation-only firm that offers cost certainty, the incentive structure changes.

Traditional law firms bill by the hour. That creates an inherent tension: the longer the case runs, the more they earn. No one is deliberately dragging cases out, but the incentive isn’t aligned with getting you a fast, cost-effective resolution.

Litigation-only firms, especially those offering fixed or capped fees, have a different calculus. We want efficient outcomes. We want to resolve your dispute in the most cost-effective way possible, because we’ve already committed to a price.

That means we’re not afraid to recommend settlement when it’s the smart play. We’re not losing revenue by cutting the case short. We’re fulfilling our mandate: get you the best outcome, as efficiently as possible.

What Cost Certainty Enables

When you know exactly what trial will cost, you can make rational settlement decisions.

Let’s say you’re facing a $200,000 claim. Your lawyer quotes you $80,000 to run it to trial. You think you have a 70% chance of winning.

The expected value of going to trial is: 70% of $0 (you win and pay nothing) + 30% of $200,000 (you lose and pay the claim) = $60,000, plus the $80,000 in legal costs = $140,000 total expected cost.

If the other side offers to settle for $50,000, you should take it. The math is clear.

But if your lawyer can only give you a vague range (“could be $60,000, could be $150,000 depending on how it goes”), you can’t do that math. You’re making an emotional decision, not a strategic one.

Cost certainty turns settlement from a gamble into a calculation.

What “Fixated on Outcomes” Means in Practice

We use the word “fixated” deliberately. It’s not casual. It’s not a marketing line.

It means we are relentlessly focused on the outcome that serves you best. Not the outcome that’s easiest for us. Not the outcome that generates the most fees. Not the outcome that makes for a good war story.

The outcome that leaves you better off than you were before we got involved.

Sometimes that’s a settlement at 10% of the claim value. Sometimes it’s a hard-fought trial win. Sometimes it’s advising you not to bring a claim at all, because the return won’t justify the cost.

But it’s always driven by what matters to you: your commercial position, your stress levels, your appetite for risk, and your long-term objectives.

The Questions We Ask Before Every Major Decision

Before we recommend settlement, or trial, or any other strategic move, we ask:

What does success look like for you? Not in legal terms. In practical terms. What do you want to be able to say when this is over?

What can you afford to spend, and what can you afford to lose? Both in dollar terms and in opportunity cost.

How much risk can you stomach? A 30% chance of a big loss might be acceptable to one client and unthinkable to another.

What happens to your business, your relationships, your wellbeing if this drags on for two more years? Is the potential upside worth that cost?

If we settle, will you have regrets, or will you feel relieved? There’s no right answer, but the question matters.

Those aren’t hypothetical questions. We ask them in every case, because the answers shape the strategy.

Where Your Current Dispute Sits (And What Comes Next)

If you’re in the middle of a dispute right now, here’s what you should be asking yourself:

Do I understand the two or three issues that will decide this case? If not, ask your lawyer to map them out clearly.

Do I know what it will cost to get to trial, and what the best, worst, and most likely outcomes are? If not, you’re flying blind.

Am I fighting this because I genuinely think it’s the best path forward, or because I’m angry and don’t want to give in? Both can be valid, but they’re different decisions.

Is my lawyer giving me strategic advice, or just executing instructions? You need a partner who will challenge your assumptions and help you make better decisions, not just a hired gun.

Would settling now, even on terms I don’t love, let me get back to running my business and focusing on what matters? Sometimes the answer is yes. Sometimes it’s no. But the question is always worth asking.

Why Dual-Side Experience Changes the Game

We regularly act for both liquidators and defendants in insolvency disputes. Both trustees and beneficiaries in trust disputes. Both claimants and respondents in contractual disputes.

That dual-side experience gives us something most firms don’t have: genuine insight into how the other side thinks.

We know what arguments will make a liquidator pause. We know what a defendant can do to make a claim look riskier than it is. We know when an offer is genuinely the best you’ll get, and when there’s more room to move.

And we know when both sides are being unrealistic and need a dose of cold water.

The Settlement Sweet Spot

In most disputes, there’s a settlement range where both sides are better off than they would be at trial. The challenge is finding it.

If you’re defending a claim and the plaintiff’s best-case trial outcome (after costs, after risk, after time value of money) is $150,000, and your worst-case outcome is paying $200,000, the settlement range is somewhere between $150,000 and $200,000.

But neither side knows the other’s numbers. So you posture. You negotiate. You test the waters.

Experienced litigators who’ve sat on both sides of that table can often find the sweet spot faster, because they know what matters to each party.

Liquidators care about speed, certainty, and avoiding the funder taking 40% of the recovery. Defendants care about capping their exposure, managing cashflow, and moving on. If you can structure a deal that gives both sides enough of what they need, settlement happens.

The Right Lawyer for Your Dispute

Acting in your best interests requires more than legal knowledge. It requires judgment, experience, and a willingness to give you advice you might not want to hear.

You need a lawyer who will tell you when your case is strong and when it isn’t. Who will tell you when settlement is smart and when you should fight. Who will give you cost certainty so you can make informed decisions. And who will focus relentlessly on the outcome that serves you best, not the one that’s easiest or most profitable for them.

That’s what a litigation-only firm brings to the table. We don’t draft contracts or do conveyancing or handle corporate transactions. We litigate. And because that’s all we do, we’re very, very good at it.

We know how to read a case early, how to pressure-test your position, how to position you for settlement or trial, and how to navigate the commercial and emotional realities of dispute resolution.

If you’re facing a dispute and you’re not sure whether your current approach is the right one, it’s worth having a conversation.

General Disclaimer: This article is intended for general informational purposes only and does not constitute legal advice. The information provided is based on Australian law as at the date of publication. Every dispute is unique, and outcomes depend on the specific facts and circumstances of each case. You should not rely on this article as a substitute for legal advice tailored to your situation. If you require advice on a specific matter, please contact Aptum Legal or another qualified legal practitioner.