If you are suing someone and you have good information, there is no reason to back down just because a lawyer shows up on the other side. Likewise, if a lawyer brings suit against you in many types of smaller lawsuits, you should consider defending yourself without paying the expense of a lawyer.
But why take on a task that even with good preparation is likely to be at least somewhat stressful? In a word, money. Lawyers routinely charge $150 to $250 an hour for their time, and that includes time spent talking to you on the telephone, researching your case, driving to and from court, and waiting (sometimes several hours) in the courtroom for the case to be called. It doesn't take a genius to understand that if you can do the job yourself, you can save buckets of money.
If you do decide to represent yourself in a lawsuit, here are a few tips for dealing with your opponent's lawyers.
Whether you are suing or being sued, keep in mind that the opposing lawyer probably has been given authority by her client to recommend an amount to settle the case. If you can demonstrate through your court papers and conversation that you know enough about the legal system to get what you deserve, the chances are good the opposing lawyer will be willing to consider a reasonable settlement at an early stage. But if you come on like Attila the Hun, the other lawyer is likely to recommend fighting instead of settling -- which a lawyer who is getting paid by the hour may secretly like to do.
If you arrive at a verbal settlement of your case, beware the lawyer who wants you to sign an agreement that is full of indecipherable legal language. At this stage it is often worth the cost to hire a lawyer to look over the document and advise you. (For more information, see Hiring a Lawyer as Coach.) Especially if yours is a good-sized settlement, the fee for a short consultation should be a bargain.
Don't be intimidated by anger or theatrics. Those who insist on putting on a show designed to scare their opponent usually succeed, whether she is another lawyer or a self-represented party.
But most lawyers will treat you politely if you do the same. If you are unlucky enough to draw an aggressive opponent, there is no reason for you to go along with it. Simply tell the lawyer you'll be glad to talk about settling the case any time, but that you are not going to sit still for overly aggressive tactics. If they continue, ask for a meeting with the judge.
When you prepare any documents you will file with a court, be sure they are accurate, typewritten, and mailed to the other side well before your court date, or the opposing lawyer can cause you grief. This is where a good self-help law book containing detailed instructions is invaluable. For instance, see Represent Yourself in Court, by Paul Bergman and Sara Berman (Nolo).