Paying a lawyer may be the last thing you want to think about. But when it comes to keeping your company afloat, seeking counsel can be your life vest.
During troubled times, you need an adviser who understands your business and your leadership personality. While many CEOs see trips to the lawyer’s office in terms of dollar signs, keeping ahead of the legal curve will pay off in the long run.
“A good, experienced lawyer will understand or try to understand his client’s business and will come across legal and business developments that can be invaluable to the client,” says Bowman Brown, chairman of the executive committee and the Financial Services Industry Practice Group at Shutts & Bowen LLP.
Your attorney can be a valuable member of your cabinet who provides strategic advice to boost your bottom line. By viewing your lawyer as a business partner and his or her fee as an investment in your company you can capitalize on your lawyer’s legal training and experience.Develop an effective relationship
By understanding where you’ve been and where you’re headed, your attorney can help you navigate the corporate waters and avoid legal icebergs. But the only way he or she is going to acquire that knowledge is through open discussions.
“Too often, during the discovery phase, the legal team or the client are finding information that is either beneficial or detrimental to the client’s case,” says Lee Teichner, partner, Holland & Knight LLP. “Finding that out at the initiation and not somewhere near the middle is beneficial for everyone.”
While some matters, such as tax tips, can result in tangible savings, others may not show an immediate fiscal return. Still, it’s hard to image what costly bumps you may encounter without the foresight of a seasoned professional.
“You can avoid serious problems if situations are developing that involve legal issues by consulting with a lawyer before the problem really blossoms into a major disaster,” Brown says.
The best advice at the right time can save a bundle. However, you can’t be shelling out for unnecessary discussions. Thinking through an issue before calling your lawyer makes the best use of his or her time and your money. Routine situations, such as hiring matters, may be handled by your human resources department, where more complex situations, like harassment claims, require immediate legal attention.
“There are some issues that are technical issues that require a lawyer’s technical advice and experience, but some businesspeople, especially HR people, get very experienced at handling the particular issues that come up in their areas,” Brown says.
If a matter requires a meeting with your lawyer, prepare notes, gather documents and create an agenda in advance. Sending information to your attorney ahead of time lets him come prepared to address the issue. Ensuring that the appropriate people are in the meeting or available on-call can avoid a costly follow-up.
“Anything that can avoid a surprise in the end is something that should be brought to the meeting,” Teichner says.
Investing in appropriate communication builds a long-term partner. However, it’s important to trim away excess chatter. Designating one contact person in your company eliminates the chance of your lawyer giving the same advice twice. If you have a recurring document, such as a purchase agreement, ask your attorney to approve a form you can use repeatedly, without getting his or her OK each time.
If you are hesitant to call your lawyer for fear of being charged by the hour, you may find relief in negotiating a flat rate for some services. Flat fees work best with a finite project, such as trademark filings. With many companies anxious to budget their costs, most attorneys will discuss fee structures.
“Most firms are always willing to sit down with clients to work out a fee arrangement that suits both the client’s needs and our needs,” Teichner says. “And we’re certainly willing to be creative if that benefits the client.”
The billable hour makes sense when it is unclear how much attention the matter will require, such as litigation. In hourly situations, it’s wise to ask for the person with the lowest billing level who can perform the work well. A junior associate can handle smaller issues in exchange for a slimmer bill. With complex matters, it is more efficient to pay a higher hourly rate for a fast-working, experienced partner.
No matter the billing structure, be sure to get a written contract that includes not only the services and the rate but also builds in checkpoints where the lawyer will call to discuss progress.
“The goal is to maximize the client’s experience with minimal cost to the client,” Teichner says. “Whether that is done with an hourly rate or flat rate, the goal is the same.”
When your business is moving along, it’s beneficial to check in with your attorney at least once a year. Such interactions make you a household name in the firm and can result in better overall service.Find the right fit
Before you turn over your spreadsheets, make sure your attorney complements your style. You may be eager for your day in court, but your attorney is best in settlements. Being on the same page is imperative to long-term success.
“Sometimes the litigation train leaves the station and, if the goal is not clear, the case can take off, and a case that could have been resolved early ends up getting resolved for somewhere around the same terms but could have been resolved much earlier,” Teichner said.
Finding a legal mind that matches your corporate spirit is no small task. As with other services, it’s wise to get recommendations from your colleagues. Referrals from your current professional team, such as your banker and accountant, can be especially helpful. Also consider the lawyer’s role in the area.
“The most important thing is to find somebody who has a lot of experience in handling whatever kinds of matters are needed and has a good reputation in the area,” Brown says.
Consider where others in your industry get their legal advice. Intimate knowledge of your market is priceless when it comes to staying on top of regulatory changes. And the legal relationship is bound by attorney-client confidentiality, so you can sleep easy knowing your company’s dark secrets aren’t being broadcast.
Once you’ve identified a few lawyers, schedule brief meetings with each. While many firms can handle the technical work, it’s important to find someone you feel comfortable with. Ultimately, the better you and your lawyer know and understand each other, the more hazards you can avoid.
“A company who seeks legal advice before initiating any action can be given a road map to navigate the various legal minefields that are out there,” Teichner says.