The Lawyer’s Global Litigation Top 50 2013 annual survey of senior in-house UK lawyers has found that projected litigation costs provided by counsel to their corporate clients were off by as much as 100%, with the average being 40%. “[E]ven experienced law firms are often woefully inept at accurately forecasting litigation costs,” the report concluded.

That mis-forecasting can be particularly devastating to a litigation matter there.  The UK has recently implemented a new civil procedure rule 3.9 as part of legal justice reforms made by Lord Justice Jackson in April of this year.  It requires that legal budgets be set and approved by the court and was recently and famously enforced in connection with a defamation suit lodged by former chief whip Andrew Mitchell MP, prohibiting him from exceeding his budget of £2,000.  “That decision sent shock waves through law firm litigation departments when the judges limited Mitchell’s costs in his case against The Sun newspaper because his legal team failed to submit a budget on time.”

Cost is not the only aspect of litigation that we are not so good at predicting.  In a prior post entitled Decision-making on Trial:  Are We promising More Than We Can Deliver?, we pointed out research done by Randall Kiser on the extent of lawyer mis-forecasting of litigation results, as reported in his book Beyond Right and Wrong: The Power of Effective Decision Making for Attorneys and Clients, and of evidence that optimism and overconfidence, particularly among  men, are drivers of some of that mis-forecasting.

Included among Kiser’s findings were two particularly troubling results: 1) the extent of the lawyer’s experience, rank of the lawyer’s law school and size of the law firm did not increase the accuracy of case evaluations; and 2) over the 40-year time period Kiser reviewed, the rate of poor decision-making with respect to litigation strategy actually increased.  “It’s peculiar if any field is not improving its performance over a 40-year period,” Kiser noted.

So what’s to be done about this escalating weakness in predicting results, as well as costs, of litigation? Do we need to keep more metrics? Employ better analytics? Put out lawyers through humility training?

Or could it be that we should trust our feelings more?  Huh?

Emotional intelligence has been shown to improve our predictive abilities in all types of endeavors.  In a 2012 review of eight studies involving more than 1,250 people, researchers found that in such diverse areas as predicting “the winner of a presidential primary (study 1), movies’ successes at the box office (study 2), the winner of a singing competition (study 3), movements of the Dow Jones (study 4), the winner of a football championship game (study 5), or even the weather (studies 6–8)… people who trusted their feelings in judgments and decisions consistently predicted these future events more accurately than people who did not.”

“Despite the range of events and prediction horizons (in terms of when the future outcome would be determined), the results across all studies consistently revealed that people with higher trust in their feelings were more likely to correctly predict the final outcome than those with lower trust in their feelings.” The researchers call this phenomenon “the emotional oracle effect.”

Interestingly, “it is mostly high trust in feelings that improves prediction accuracy rather than low trust in feelings that impairs it. As Professor Michel Pham, the lead researcher, explained: “When we rely on our feelings, what feels ‘right’ or ‘wrong’ summarizes all the knowledge and information that we have acquired consciously and unconsciously about the world around us. It is this cumulative knowledge, which our feelings summarize for us, that allows us to make better predictions. In a sense, our feelings give us access to a privileged window of knowledge and information — a window that a more analytical form of reasoning blocks us from.”

There are undoubtedly skeptics out there, whose eyes are surely rolling, but maybe the rest of us should try feeling our way to a sharper ability to predict.