A Guide To Hiring The Right Lawyer
Based on our research, budget is the single most important issue for small businesses and individuals when seeking legal advice. Yet, “think about your budget and times it by two” is a well-known adage about seeking legal advice. While the possibility of legal costs escalating to double or even more of your original budget can ring true for many lawyers, we don’t believe that this should be the case. Firstly, there should be lawyers out there who can provide their services in line with your budget without compromising on quality, and secondly, if you have allocated funds for legal spend, it will come as less of a shock if the costs go over what you anticipated.
It is important to think about your budget for legal matters from the outset when starting or running a business, as there will more than likely be things which arise that you couldn’t have anticipated. The legal aspects are not the sexiest part of starting a business, but they are incredibly important. Make a budget and if you don’t have the money for something right away, you can prioritise the most important and schedule others when you have a bit more capital.
Make a budget and if you don’t have the money for something right away, you can prioritise the most important and schedule others when you have a bit more capital.
Once you have made your budget for legal costs, it can guide your initial conversations with lawyers and gives them an opportunity to bring their quote as close to your budget as they can.
Of course, if you are dead set on keeping to the lowest budget possible, you will notice a difference in the service and end-product you receive. While it may seem expensive, sometimes it is just not cost effective for lawyers to provide services below a certain amount. It may not seem like a lot of work for you to draw up an agreement, but remember if it goes wrong or something is missing it is your lawyer who will bear that responsibility.
See Also: When a Business should switch lawyers
How quickly you need your matter to be dealt with is an important factor to consider when choosing your legal provider. It is OK to ask potential lawyers how much capacity they have right now to ensure that they can meet your deadlines and it is important that they are made aware of any urgency to your matter.
“An experienced small business lawyer should be able to counsel clients on all of the above issues while recognising when to refer them to a specialist because the matter has become too complex or beyond the general knowledge of the attorney.”
– Jeffrey Steinberger
The journey to becoming a qualified lawyer is a long one and covers a vast amount of legal skills and knowledge; however this doesn’t make a lawyer an expert in a particular area of law, as this too takes time. When a matter requires specialist advice, it should be done by, you’ve guessed it, a specialist. So if a lawyer is telling you they can do everything from tax to wills to commercial agreements, you might want to ask for some specific experience that they can draw on in those areas.
Better still, look for someone who knows their trade and their market inside out and isn’t trying to just win your business. If someone is used to advising multinational companies on their corporate structure, what do they know about startups and SME tax credits? That doesn’t mean that you should necessarily seek the advice of a 20-year qualified partner of a tax specialist firm for your VAT registration. However, you should be wary of hiring a ‘jack of all trades, master of none’.
When a matter requires specialist advice, it should be done by a specialist. You should be wary of hiring a ‘jack of all trades, master of none.
Business Advice As Well As Legal Advice
Although it is important to find a lawyer with a relevant specialism; as a startup business founder you need more than just a legal advisor in the early and growth stages of your business. A commercially well-rounded lawyer is the perfect addition to a startup and can complement your own skillset and assist with reasoning without needing to hire a co-founder. In practice, your lawyer isn’t going to make your business decisions for you, but you should respect their views enough to ask what they would do. Returning to the point of knowing their market, your lawyer should understand your business, your sector, and be able to tailor their advice, accordingly. HOWEVER, this does not mean that your lawyer should become your confidante.
Time Is Money
Sadly, this statement is particularly true of legal services, in a culture of hourly rates and time accrued billing systems. Lawyers traditionally record their time spent on matters in six minute increments. One way to avoid your fees from escalating is to see if your lawyer will provide a fixed fee for specific deliverables, such as a contract. Define the scope of work carefully so that you are clear on what you require.
A lawyer with expert knowledge of their area should be able to anticipate the time required to complete a matter, so hold them to an amount rather than giving them free reign to let fees spiral out of control. In our experience, fixed fee arrangements allow for a more upfront relationship and less cause for resentment – most importantly, you won’t be presented with an unexpected bill. If a fixed quote is not possible, suggest that you have a cap on fees for certain stages of your matter, Once you have agreed a fixed fee or capping arrangement, both yours and your lawyer’s expectations will be clear and they can start work on your matter.
In our experience, fixed fee arrangements allow for a more upfront relationship and less cause for resentment
Size Doesn’t Matter
Sure, the big firms have big insurance policies and big-name clients. However, they will also likely have big price tags to meet their costs. At it’s heart, a lawyer client relationship is a personal relationship, so the size of your lawyer’s team or other departments in their firm is actually pretty irrelevant to how well the relationship is going to work.
UK businesses experienced 3,681 lawsuits per 100,000 people in 2010
Don’t ‘Do It Yourself‘
The power of Google means that it is easy to just look up your legal issue, download a template document, and adapt it for your needs. Legal matters dealt with ‘in-house’. No lawyer needed. False. This is where businesses most often fall into difficulties by copying the wrong terms and conditions or employment contracts.
As we have already said, law is an EXPERT subject which takes YEARS of training and is internationally diverse, so if anyone could just write a contract for any territory wouldn’t lawyers all over the world be extinct by now?!
Just as we would never let our in-house lawyer try to fix our office plumbing, DIY law is not recommended.
This is the all-time biggest misunderstanding or myth we have come across when it comes to legal services We often get requests from clients looking to avoid escalating legal fees who have found a document template online or from a friend and then would like a lawyer to simply ‘review and check if anything is missing’ or tailor this to your business.
Whilst this may on the face of it seem like a time-saving exercise, it is nearly always more complex and difficult than asking your lawyer to draft ‘from scratch’. Actually, a lawyer will have their own templates (sometimes known as precedents) they know inside out and can much more effectively issue spot and tailor to your needs, rather than spend time reviewing and comparing your document of which neither you nor your lawyer knows the providence and therefore quality.
Remember, lawyers are both risk averse and like to do things their way! Continuing with the DIY analogy, if it cost more or less the same, would you rather have holes in your existing carpet patched up or replace the whole thing?
A lawyer will have their own templates (sometimes known as precedents) they know inside out and can much more effectively issue spot and tailor to your needs.
Outsourcing To Outsource?
We all find it annoying when you phone your bank or mobile phone operator and have to speak to 10 people before you can get your matter dealt with. When searching for a good lawyer, be sure to always enquire as to who will be dealing with your matter.
The nature of law firms is such that the partner or most senior member of the team will usually be responsible for bringing in your business to the firm, but may well outsource the work within their team to someone more junior. If it is a junior associate or another team member that will mostly be handling your work, ask to meet or have a call with them before selecting your legal advisor.
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