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10 Questions to Ask Before Hiring a Small-Business Attorney

February 12, 2013
URL: http://www.entrepreneur.com/article/225395

When you hire an attorney, that professional will be handling some of your company's most sensitive legal issues so it's important to hire someone you feel comfortable working with. "A good attorney is also a counselor at law," says Ed Leach, a small-business attorney in Charlotte, N.C., and former district office attorney for the Small Business Administration. "When you have a relationship like that with somebody, it's got to be a trust relationship."

Here are 10 key questions to help you find an attorney who is just the right fit for your business:

How much experience do you have with my industry?
Such issues as intellectual property, franchise agreements and service contracts require special knowledge and skills, says Leach. Find out if the attorneys you're screening have worked with a company similar to yours and if you can speak with any previous clients. While some attorneys might be offended by this request, "they shouldn't be put off if you ask them to give a couple of names," Leach says.

What is your approach to conflict resolution?
Find out how much of an attorney's time is spent battling it out in court and how much is devoted to mediating disputes. Then, decide which approach you're more comfortable with. "Sometimes attorneys who are highly litigious are hard to mold when you want to settle a case," says Deborah Sweeney, CEO of Calabasas, Calif.-based MyCorporation, a document-filing services firm that helps small businesses incorporate.

Will there be anyone else handling my work?
Most lawyers assign work to paralegals, but Sweeney cautions against attorneys who delegate an extensive amount. Taking the time to explain something to your lawyer, then having it re-explained to a paralegal could cost you more money and might muddle the message, she says. While some work can certainly be delegated, be sure that you're clear on who will be handling which tasks.

Do you have any clients who could create conflicts?
Find out if your prospective attorney is working for other clients such as competitors or former business partners, who could pose a conflict of interest. If so, problems could arise, and you may not feel comfortable sharing competitive information with the attorney.

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How long do you typically take to get back to people?
If you want your attorney to be prompt and easily accessible, be sure to ask how long he or she takes to get back to you when you call, Leach says. Sometimes, you have to go through a paralegal first and may not connect with the lawyer for several days.

How do you typically communicate with your clients?
Some attorneys prefer to correspond primarily via email or phone; others don't communicate much beyond scheduled office meetings. You're likely going to want to work with someone who is available to answer your questions as they come up, so be sure to find out what their communication style is and whether it works for you.

How do you bill?
To avoid surprises when your attorney's bill arrives for the first time, find out exactly how lawyers bill, Leach recommends. Some may bill for minimum increments of 10 minutes, while others might not bill for less than an hour. Also, ask about other expenses such as research and paralegal fees. 

Related: Top 3 Legal Mistakes Entrepreneurs Make and How to Avoid Them

Are there ways to reduce the cost of your services?
Don't be discouraged by what seem to be high fees. Ask if there are ways to cut down on costs, says Fred Steingold, an Ann Arbor, Mich., attorney and author of Legal Guide for Starting & Running a Small Business (Nolo, 2011). For example, you might be able to save money by rounding up documents or writing a summary of events for a legal case yourself. "There are things clients can do that are often helpful," Steingold says. "If the lawyer is not willing to explore some of those options, it might raise a red flag." 

Do you belong to any specialized bar associations?
You want an attorney who keeps up with the latest legal and business matters. Be sure to ask whether he or she belongs to such groups as the local bar association, chamber of commerce or a small-business advisory board. "Are they taking a step beyond just saying, 'I do business law'?" Leach says. "The problem with a sole practitioner is sometimes they turn into monks and aren't out in society. You want someone who is keeping up with what's going on." 

Do you make referrals to other attorneys?
You need to know whether your attorney would be willing to put you in touch with their colleagues on a specialized issue he or she lacks experience in. For fear of losing business, some lawyers are wary of referring clients to other attorneys, even if they have expertise in a particular area, such as tax law.