Hiring a good lawyer is as critical to running a successful business as finding a good accountant. A good business attorney will provide vital help in almost every aspect of your business.
“It’s best to form a relationship with an attorney who understands your business, the industry and the challenges that you may face,” says Kirsty Simpson, director at Brink Cohen Le Roux. “Your attorney can be a great sounding board and can give advice from a legal perspective prior to your company finding that it has prejudiced its rights.”
Simpson cautions that in cases where a business cannot afford to retain an attorney you should, at the very least, obtain an attorney’s view prior to signing any contract, concluding any verbal contract, on receiving or sending a letter of demand.
The size of the law firm that you approach will depend on your needs, the costs, the nature of the legal issue and the importance of the issue to your business. “You may require specialist advice – when it comes to labour matters or tax law – for example, and it is therefore necessary to seek an expert in the field,” says Simpson. “One of the benefits of medium and large law firms is that you can be referred internally to another lawyer who is a specialist in the field of law that applies to your specific issue.”
There are lawyers who are essentially “one-stop shops”, who will deal with any legal issue you may have, from contracts and tax to intellectual property protection. However, says Simpson, there are numerous fields of law and the legal jurisprudence in each is well developed. “It is often advisable to approach an attorney with specialist knowledge in a particular practice area. If the matter is going to court and warrants the appointment of counsel, you should at least appoint an advocate who is a specialist in that practice area.”
Questions to ask
Simpson recommends that you ask these three key questions before appointing an attorney:
- What are the attorney’s fees and what disbursements will be incurred?
- Does any conflict of interest exist? Does the lawyer act for the opposition or have intimate knowledge of the matter due to his or her involvement with the opposition?
- What are the attorney’s skills, experience and expertise?
“Generally, at the start of your relationship with an attorney, or sometimes on every new instruction, you will receive a letter containing the terms of the appointment of the attorney, including the hourly fees, deposits required and payment terms,” she says. “If you do not receive such a letter, it is preferable to request these details in writing so that you understand the terms of your relationship.”
For many entrepreneurs, the idea of consulting a lawyer conjures up frightening visions of skyrocketing legal bills. But there are ways to control legal costs. Lawyers generally bill per hour of work completed according to an agreed hourly rate. “A flat fee may be negotiated with the attorney, particularly in matters relating to the negotiation and drafting of contracts,” says Simpson. “You ought to be prepared to pay a deposit, which is held in a trust account by the attorney on your behalf. The trust fund can be invested so that you earn interest on it.” Simpson points out that it is always difficult to estimate legal fees for a matter, as you cannot anticipate all the challenges that will be raised by the opposition.
It may be worth negotiating a flat fee for work to be done, or to place a cap on the fees – in this case, you may agree that the work will be charged out at an hourly rate but will be no more than R30 000, for example.
Another option is to obtain fee quotes per stage of the legal process and then reassess after each stage the cost-benefit of proceeding with the matter. “Here you would look at the costs of considering the matter, drafting a letter of demand and following up on payment; the cost of instituting simple summons; the cost of a summary judgment application; and the cost of a trial,” Simpson explains.
A further option is to request that junior professionals at the law firm do the work insofar as their skills allow it, so that a lower hourly fee is charged.
“It’s imperative that, as a client, you do the legwork – provide full instructions, make copies of all relevant documents, and peruse and point out relevant portions of the documentation,” Simpson notes. “If you don’t do this, the lawyer will be forced to and will charge you for it.”
Where to find an attorney
According to Simpson, the best way to find a good attorney is to ask friends, family and business acquaintances for recommendations. “You can also look at sites like www.attorneys.co.za but these website databases do not provide an indication of the quality or merits of the attorneys listed. If the matter is of great consequence, you can also consider rankings such as Chambers Global, Legal 500, Best Lawyers and Practical Law Company.”