Getting the Most From Your Attorney

A good relationship with an attorney can add a lot of value to your business. On the other hand, many a business has failed because of bad legal advice, and even good legal advice is often accompanied by unnecessary fees. Here are 10 tips for making sure your attorney is adding value consistent with your business goals.

1. For small companies with more than one owner, it is critical that the attorney and client both understand who is authorized to speak for the company. Also clearly specify what your attorney will do for you and how he or she will be compensated.

2. It is helpful to network with attorneys and create a list of attorneys whose services you may need in the future. This way you can tackle legal problems as soon as they arise. Small businesses should generally have “go to” counsel in the areas of corporate/transactional, commercial litigation, intellectual property and employment law.

3. Use lawyers to prevent problems, not just fix them. Many small businesses do not have attorneys until they think they need them. You need to make sure you are proactive in identifying legal issues before they become problems, and problems before they become lawsuits. For example:

-Forgo the “legalzoom.coms” of the world that offer do-it-yourself incorporations, and hire an attorney to incorporate. Contact an appropriate counsel to discuss tax and liability ramifications.

-Do not wait for the lawsuit — by ignoring a competitor’s letter that accuses you of stealing intellectual property, for instance.
-If your business model would be aided by intellectual property, spend a few hours of attorney time exploring the costs and benefits of securing patent, trademark or copyright protection. These can be complex issues that require retention of an attorney with extensive experience in intellectual property law, and should not be decided without legal advice.
-As your business grows, and depending on your industry and business model, consider bringing in an attorney to address and prevent legal problems related to employee benefits, corporate taxation and environmental issues.

4. Make sure your corporate attorney understands your business goals as well as how you do business. Do not hire an attorney only to put out discrete fires. For example, if you are hiring a patent attorney to respond to a competitor’s letter accusing you of infringement, make sure the attorney understands how the patent complements your business goals and that he prepares a response consistent with those goals. An exception is if you hire an attorney to address a specific problem that does not go to the heart of your business goals moving forward.

5. Make a list of all points you want to discuss with your attorney in advance of meetings or phone calls. Your calls will be shorter and therefore less expensive since you have an agenda, and you will get more out of the call. Do not chitchat with your lawyer, as it is difficult for the attorney to separate the meaningful conversation from the fluff and you will probably get billed for the entire conversation. Use e-mail whenever possible for routine communications.

6. Always tell the truth — attorney/client privilege is designed to allow clients to be absolutely candid with their attorney. Unless you are planning a crime, communications with your attorney will not be disclosed to third parties, so it serves no purpose to be evasive. Many, many clients hide things from their attorneys, but attorneys cannot perform well without the facts. You hire an attorney to give you the best advice and the highest level of advocacy. Clients who hide facts from their own attorneys are depriving themselves of good legal services.

7. Raise performance and billing issues promptly and in a straightforward manner. (For some common billing issues, click here).

8. Get every agreement that is important to your business in writing, and don’t sign anything you do not completely understand without your attorney’s advice. Chances are your business model will require many different written agreements — with clients, vendors, investors, etc. This is a primary reason to hire an attorney and cultivate the relationship.

9. Make sure your attorney is the right one for a particular problem. Do not, for example, use the corporate attorney who drafted your incorporation documents to defend an employment discrimination case, unless the attorney has the expertise to do both well (which is rare). There are many ways to find the right attorney. Martindale.com is the preeminent website for finding attorneys, and you can search attorney and firm biographies by practice area and location. In the Big Apple, the Association of the Bar of the City of New York has an excellent referral service. And, of course, a referral from a trusted colleague is an excellent way to pick a lawyer.