Every company needs two skilled workers from the start an accountant and a lawyer. The reasons for hiring an accountant are obvious: You need someone to help you draw up your “chart of accounts”, check your figures regularly, and prepare all the necessary tax returns for the federal, state, and local governments. However, the reason for hiring a business lawyer may not be that obvious. A good business attorney will provide you with vital assistance in nearly every aspect of your business, from basic zone compliance and advice on copyrights and trademarks to formal business formation, prosecution, and liability. First, some general rules for dealing with lawyers
- If you get sued, it will be too late. Most small businesses postpone hiring an attorney until the sheriff is on the door to summon them. Bad mistake. The time to get in touch with a good business lawyer is before you get sued. Once you’ve received a subpoena and complaint, it’s too late – the problem has already arisen and it just depends on how much you have to pay (court fees, attorney fees, settlements, and other costs) to solve the problem. The US judicial system is similar to a Roach Motel it’s easy to go to court, but once you’re “trapped” it’s very difficult to get out. Most lawyers agree that no one likes to pay attorney’s fees for anything (heck, let’s hang our hair no one likes paying or dealing with attorneys, period), but the fees a lawyer charges you, to keep you out of anger are only a small part of the fees a lawyer charges to keep you out of anger once it has happened.
- Big Business or Small Business? Typically, the larger the law firm, the higher the overhead costs. The higher the hourly rates you have to pay. Still, large companies have a number of advantages over smaller ones. Over the past 20 years, lawyers have become incredibly specialized. If you employ an individual solicitor or a small law firm as your attorney, they likely don’t have all of the skills you need to grow your business. I don’t know a single practitioner and very few small firms ( fewer than 10 lawyers) who could handle your lawsuits, negotiate your office or commercial space lease, file a patent or trademark, write a software license agreement, and advise you on dismissing a disruptive employee and the monitoring of your annual company meeting. Sooner or later, these “generalists” will have to refer you to specialists and you will face two or three (or even more) lawyers. While large companies are more expensive, they have two important advantages: 1) they usually have all the legal skills you need “under one roof”, and 2) they have great influence at the local level. Regional and (possibly) national legal community. A nasty letter from a “powerful” law firm with offices in 30 states is far more intimidating than a nasty letter from a lone practitioner who is not permitted to practice in the defendant’s state. Additionally, affiliation with a large, established law firm can have intangible benefits. They may be willing to introduce you to sources of funding or use their name as a reference when researching partnership agreements. If you run a fast-growing entrepreneurial business that someday wants to go public (or sell to a large corporation), you need to partner with lawyers whose names are recognized in the investment banking and banking community. Capital risk.
Types of lawyers
Like doctors, lawyers are becoming more and more specialized. Someone who mainly wills, house closures, and other “non-business” matters done, is probably not appropriate for your business. At a minimum, you will need the following skills. The more skills there are in the same person, the better!
- Contracts. You need an attorney who can understand your business quickly. Prepare the standard contracts that you need with customers, customers, and suppliers. and help fulfill contracts that others want you to sign.
- Trade organizations. You need an attorney who can help you decide whether a public company or a limited liability company (LLC) is the best way to organize your business and prepare the necessary documents.
- Real estate. Leases for commercial space – such as offices and retail stores – are very complex and are always made for the benefit of the owner. Since these are usually “printed” documents, you might be tempted to believe that they are non-negotiable. No. Your attorney should have a standard “tenant addendum” that contains helpful provisions that can be added to the rental document in printed form.
- Taxes and Licenses. Although your accountant will prepare and file your tax returns every year, your attorney should know how to register your business for federal and state tax identification numbers and understand the tax ramifications of the more basic business transactions your business engages in. ‘.
- Intellectual property. If you work in a media, design, or other creative industry, it is definitely a plus if your attorney can help you register your products and services for federal trademark and copyright protection. In general, however, these tasks are carried out by specialists who only carry out legal work on the subject of “intellectual property”. If your attorney says he or she specializes in small business, he or she should have a close working relationship with one or more intellectual property specialists.
What to ask for in an interview with a lawyer
- Do you have experience? Don’t be afraid to ask direct questions about a lawyer’s experience. For example, if you know you want to start your business, ask him if he has ever started a business.
- Are you well connected Your business attorney should be something of a legal “internist” – someone who can diagnose your problem, perform “minor surgery” if necessary, and refer you to local specialists for “major surgery” if necessary? No lawyer can know everything about all areas of law. If your company has specific legal requirements (a graphic designer may need someone familiar with copyright law) your attorney should either be familiar with that particular area or have a working relationship with them. You shouldn’t have to look for a new lawyer every time a different legal issue arises.
- Do you have other customers in my area? Your lawyer should be fairly familiar with your industry and legal environment. Otherwise, he or she should be willing to learn the pros and cons. Search your candidate’s library or newspaper rack for copies of the same journals and publications you read. However, be careful with attorneys representing one or more of your competitors. While the code of ethics (yes, there is one, believe it or not) requires your attorney to keep everything you tell them to be strictly confidential, you don’t want to risk accidentally disclosing confidential information to an attorney.
- Are you a good teacher Your attorney should be willing to take the time to educate you and your employees about the legal environment in your company. He or she should tell you what the law says and how it will affect the way you do business so that you can identify problems early on. The right lawyer will hand out freebies such as newsletters or memos detailing the latest developments in the law that are affecting your business.
- Are you a seeker, keeper, or grinder? Almost all law firms have three types of lawyers. The “researcher” looks for companies and brings in new customers; The “gatekeeper” accepts new customers and ensures that existing ones are satisfied. The “mill” does the work for the customers. Your attorney should be a combination of a “keeper” and a “grinder”. If you feel that the lawyer you are speaking to is not the one who is actually doing your job, ask to meet the “grinder” and make sure you are comfortable with them.
- Will you be flexible with your billing? As there is currently a “flood” of lawyers, with far too many practitioners in most geographic areas, lawyers can negotiate their fees like never before and this is certainly a “bargain” for buyers. Still, there are limits – unlike personal injury attorneys who advertise on television, business attorneys almost always do not work for “contingent fees” that are only payable when their legal work is done in the workplace. Your satisfaction.
Most lawyers charge a one-time flat fee for routine matters like starting a business or a limited liability company but don’t offer a flat fee unless you request it. Be sure to ask if the blocking fee includes payouts (the attorney’s expenses, such as filing fees and overnight courier costs) and when the blocking fee should be paid. Many lawyers require you to pay a lump sum upfront to cover your personal expenses. You should still ask to “hold back” 10 to 20 percent of a lump sum if the attorney doesn’t do his job well.
Lawyers are reluctant to offer a fixed fee when it comes to litigation or negotiations with third parties. The reason is clearly stated by a lawyer friend of mine: “Even though this is a transaction I’ve carried out dozens of times, it turns out that the other party’s lawyer is a smug idiot fighting for every comma and semicolon in contracts want. Then I can not control how much time will I spend on the case, and I will end up losing money if I quote a fixed fee. ” In such situations, you have to pay the hourly rate of the lawyer. you should always a Written request ask for an estimate of the time required and advance notice if circumstances arise that cause the attorney to exceed his estimate.
If an attorney asks you for a down payment or a down payment against future fees, make sure the money is used, not taken indefinitely, and that the attorney agrees to return any unused portion of the reservation if the Transaction fails reason. You should be wary of any attorney who offers to get involved in your business instead of paying a fee.