When asked "When do you call your lawyer," most people respond "When I have legal problems." I would like to suggest you evaluate whether that is the best answer. I believe getting preventative legal advice will reduce the number of legal problems you have, increase the likelihood of a favorable resolution those issues, and over all, reduce the amount of legal fees you incur. In the interest of full disclosure, I am a lawyer and I prefer taking preventative measures to litigating disputes.
Here are some situations where I suggest you consider getting preventative legal advice:
Starting a new business - When you are starting a new business, build into your budget 30 min to one hour of preventative legal advice. This is especially important if this is your first business. You should set an agenda with the lawyer and should discuss general legal issues and any issues related to your specific industry.
Going into business with someone - This can be more expensive than just getting some advice when you start your business. However, it is absolutely essential if you are going into business with someone, that you clearly define and document the roles of the parties, how decisions are to be made, and what happens if the people disagree as to how to proceed. A lawyer can give you advice how best to ensure that your interests are protected.
Form contracts - If you have a contract that you ask your clients to sign, have your lawyer review it to ensure it adequately protects your interests. Make sure that you 1) understand your form contract and 2) know how to properly fill in all the blanks. There are certain industries that have specialized contract requirements in certain states. Make sure that you are in compliance with those requirements.
Have a plan to get paid - In my experience, it is common for business owners, especially service providers, to focus too much on getting a client, and not enough on making sure the client pays for the services rendered. Ask your lawyer for suggestions in this area and discuss and consider asking for a deposit, personal guarantee or other form of security.
If I corner you at a cocktail party, I'm always happy to go on; and on; and on; about cases that I have been involved in that could have been easily prevented if my client had followed the advice above. Ultimately, you have to make a decision about the level of risk you are comfortable with, and a determination regarding the value of preventative legal services.
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Good advice! I just started my first business, and I would add privacy policies to the list of things to consult a lawyer about, especially if you plan to have an e-newsletter or an e-commerce site.
ReplyDeleteAnd contracts are so important! I always read them as an employee, and they all sounded the same, syntactical errors included. As an employer though, requires a different perspective, and consulting a lawyer helps provide that perspective.
Amen, and amen. My husband and I could have been spared so. much. stress. last summer, when our business partner bailed (and nearly took everything with him) had we thought ahead and followed the first and second tips above.
ReplyDeleteLitigation is always a possibility to fix things . . . but how much better it is to have an agreement in the first place!