There are so many stereotypes about attorneys. Some of them are true, of course, but most of them are not.
Some attorneys are, for instance, sharp dressers, every bit the models for the top designers that you might expect, with perfect hair and a packed brain to match, but not all attorneys look like they belong on the cast of some courtroom drama that moves through its story arc each week in 44 minutes flat.
Some attorneys are fast and slick and out to make a quick dollar or a quick couple of thousand dollars but not many.
And, yes, some attorneys are blindingly intelligent and able to rattle off laws, statutes, regulations and court cases long since decided as if it was their job because, well, it is.
Your attorney is not a heart surgeon, a rocket scientist or a neurophysicist. They might as well be, though, to handle the level of work and degree of difficulty required during the last couple of years. After all, you have probably rarely called your attorney for something casual during these strapped economic times. Calls always seem to be reserved for something expensive and stressful that has to be handled correctly.
“I try to get my clients, particularly those that don’t have an in-house legal staff, to look at lawyers as part of the management team,” says Steven N. Haas, member and vice chairman of the corporate practice group, Cozen O’Connor. “Legal issues pervade so many decisions and a lawyer who has experience in those areas has a perspective that could be very constructive for clients.
“A lawyer can’t be effective counsel without your information, and that means there has to be constant communication.”
Constant communication. Do you have that with your attorney? If not, you might be in the midst of a missed opportunity. A majority of attorneys say this is an opportune time to think, then think again, about your business strategy and to examine the economic landscape, because there are opportunities available right now, even in slower industries, that will not be available for long. If you can afford to, this is the time to move. And if you have a good attorney on your team of advisers no stereotypes here you already have about as good an ally as possible to help steer you forward.Remember the past
The last couple of years have provided you with a new set of challenges. Perhaps you needed to lay off a percentage of your employees, close a branch of your business or just do more every day with an already overworked, if not smaller, staff. Odds are your attorney was with you during many of those moments because even if you didn’t work more with your attorney in order to save legal fees, you probably called and talked more often.
That is, at least, what many attorneys are saying.
“It does depend on the nature of the client,” says Paul J. Jaskot, partner, Reed Smith. “We have two significant focuses here the life science health industry and the financial industry and each of those categories of clients has been reaching out to us more, particularly as it relates to how regulatory reform is going to impact their businesses. That work has increased. Another area that has increased is the workout-type work whether it’s in real estate or general commercial loans because there’s such a high volume of that type of work.”
The amount of work and communication required of some attorneys will also likely increase through the rest of 2010 and during the early months of 2011.
“There probably is now a better feeling that things are turning around,” Jaskot says. “It’s not quite there, but I do know we’re getting more phone calls, particularly about transactional work and putting in proposals for work. I would say that, if you asked me two or three months ago, I might have given a different answer, but now, for 2011, I’m cautiously optimistic that the increased usage is going to inch up.”
Until then, the existing bump in bankruptcy, commercial litigation and corporate reorganization sure signs of an economy that has seen better days, months and years will likely continue.
And valuations are still historically low though not as far in the cellar as they were during much of 2009 which means now is still a good time to examine and consider estate and succession planning. What will your business do after you’re out of the top spot? Who will own the business? Who will be in charge? And were you able to take advantage of a down market to pass it along at a better rate?
There are plenty of other things you should consider with your attorney before the economy starts to bump up a little more.Look ahead and plan
Did you manage to obtain any sort of credit during the last two years? If so, congratulations. That is quite an accomplishment. If not, no worries, because not many other companies did either. That said, some good news for the coming year is that credit is expected to be more available in 2011 than it has been in several years.
More credit is just one of the major points of interest for attorneys during the next six to 12 months. Because of those increased lines of credit, much of the next year will likely include a focus on mergers and acquisitions. Some attorneys say that M&A activity increased during the first half of 2010 before slowing some during the last four months, but no matter your city or region and Philadelphia and Eastern Pennsylvania are expected to be no different M&A activity will likely be prevalent by the time the calendar turns.
“On the business side, we’re seeing the strengthening of M&A activity, and we’re seeing public offerings for the first time,” Haas says. “Clearly, there is headway being made in the financial markets. There’s a different outlook, and companies are having to plan for that.”
Alternative fee structures and arrangements or at least discussions about them are also expected to increase in 2011. Some firms have provided them for years as an option, others have added them only during the last couple of years as clients asked for them, but there does seem to be a split between clients who are more open to alternative fee structures and those who hold tight to the hourly rate.
Even if you have no interest in alternative fee structures and will renew your proverbial subscription to the hourly rate, at least starting a conversation with your attorney or legal team about some other option might not be a bad idea, especially with the economy and cash flow still in flux.
“I think alternative fee structures are becoming more prevalent nationally,” Haas says. “There have been plenty of articles written about it, and I think people are looking more at them and clients are demanding them. There are a number of clients the last couple of years who have arranged freezes in rates. There’s no question that there is downward pressure on increasing rates, and there are all kinds of creative solutions.Ensure your value
How can you be certain that you will receive as much value as possible from your partnership with your attorney? Communication, of course the seemingly simple center of every conversation and great relationship remains the top priority. If you do not talk regularly with your attorney or if you rarely, if ever, ask questions or send recent documents and forms, you need to communicate more.
Most attorneys say they like to talk with clients at least once per month, just a casual meeting for breakfast, lunch or coffee to sit down and talk about you and your company, especially if they work with you more as an adviser than as an auditor though every relationship is different.
“It’s all relative, but if you haven’t heard from a client in weeks and you call them and you hit them with charges, are you being fair to the people you care about the most?” Jaskot says. “It goes both ways. Are they being fair to us? Are we being fair to them? It’s a symbiotic relationship. My belief is that more is better. The best relationships are those where you’re in sync with each other.”
And if you are not pleased with the quality or the nature of the relationship you have with your attorney, for any of a number of reasons, the time to consider a move might be now. Rates are historically low and this is perhaps the best buyer’s market of any of our lifetimes.
“If a client has a relationship with its law firm where they hesitate to pick up the phone because they’re going to be billed for the 10 minutes it takes to answer a quick question, that’s not the type of relationship we want with our clients,” Jaskot says. “If they hesitate to pick up the phone, it’s going to end up costing them more money.”
You might want to consider a change if you have just outgrown your firm and need a firm with a larger regional, national or international footprint.
You might also consider asking your attorney about any changes in rules and regulations for 2011 and beyond. Asking whether the firm offers any corporate education that you and your employees might be able to put to use would also be a good idea. And asking for a review of your corporate structure, especially for possible inefficiencies, would not be a bad use of time or money. What are your employees earning? What are your executives earning? What else are you paying for? And is it really worth the cost?
“Lawyers bring a unique perspective to business issues,” Haas says. “For a lawyer who has many years of experience, that would provide the client with that experience they wouldn’t otherwise have on their own. It’s important for clients to appreciate what lawyers can help them do for their business, and it’s important for lawyers to listen.
“If clients use their lawyers as part of the management process and lawyers do their job in listening and keeping in touch with their clients, then there are opportunities for both sides to maximize the benefits of having a relationship between a lawyer and a client. That, to me, is where the services really are.”
Because in a world and an industry filled with so much change during the last couple of years, something needs to stay the same.