Hey, guys. Rachel Brenke here. Let’s talk a little bit about hiring of a lawyer. I’m going to go ahead and set the stage and let you guys know the bad news is that the majority of lawyers are not as fun and charming as yours truly. In fact, finding an attorney for your business can be one of the most stressful, overwhelming, and scary things to do. You already have this preconceived idea that lawyers are sharks, they’re scum, or out to get your money, or you just don’t understand how it works, and so you become so overwhelmed and fearful, you shut down, and you avoid ever going to an attorney.
Unless you are somebody that is an attorney yourself or you have a family member, which still would fall under this realm of going to an attorney, as a business owner, if your attorney has not touched your business in any form or fashion, and hopefully more than less, if they have not touched your business in business formation evaluation, such as choosing the setup structure and all the legal documents that need there. Contracts, working with others, hiring others, intellectual property needs. If you have not worked with an attorney at some point, you guys are setting yourself for potential issues.
I know the biggest pushback on this is not just the overwhelming aspect of how to hire an attorney. It may be the money portion, so I’m just going to go ahead and give you an example right off the bat before I jump into teaching you how to find an attorney and one that’s really going to work for you, not the other way around. I have tons of client stories that I could share with you of business owners who wait until they have an issue to hire an attorney. Recently, I had a client who had a services contract, not unlike many of you listening to this. They had inquired to hire me, let’s just say in February of the year, to review their services contract and maybe some potential for non-payment by their customers or clients.
They decided that the $99 initial assessment fee didn’t fit within their plan and the hourly rate was too much. Hourly rate, we’ll throw out there is about $300 an hour. Just for a nice, hard, even number for you guys, which is not unlike many areas in the country. Again, I’m right south of Washington, D.C., so mine might be a little bit on the higher side, but just know that you’re probably looking at an average between two to $300 an hour for an attorney. I’m going to tell you some little tips as how to make sure that you manage that amount as well.
This potential client had come to me to reevaluate their contract and then they decided that it was too much money, or they just didn’t want to engage in it. Fast forwarding 10 months later, this small business owner continued to use the document that they had pieced together from stuff they had found online, and these were contract terms that the clients and customers were agreeing to. The unfortunate thing is, there was an issue. Again, there’s not an issue until there’s an issue, and then you guys end up spending more money and time and energy on it than you need to. The customer did not want to pay this very little amount of the bill. It was probably about 10% of the entire services amount that they did not want to pay.
When it was time to go enforce the non-payment sections of the services terms, they were severely lacking in legal sufficiency and enforcement to get paid. The long story short is that this $300 amount that the business was then trying to get the customer to pay, which was the balance that the business was rightfully owed, when the business decided to go and press for non-payment against the customer for the $300, the end result ended up being that going to trial and everything ended up costing them about $3,200, $3,500 and that was even after some discounts that we provided on our hourly rates to them as then being a small business owner.
You can see that the $300, maybe $600 done in the February of the year would have helped to prevent issues later on. We also would’ve done an evaluation to say, “Maybe $300 on tens of thousands dollar job is not necessarily worth pursuing because of X, Y, and Z.” The business owner would’ve been able to make a better decision of whether or not to enforce for non-payment. Those are some things to consider. That’s a really prime example. Something that’s very recent in my legal practice.
We did win. We did win in the sense that the claims, they got their $300 balance and then there was a counterclaim from the customer, and we got that thrown out. All of that was super awesome, but yet, did the business owner really win? No. They still had to pay out for attorney’s fees. We did request attorney’s fees, but because it really wasn’t in the contract properly, they didn’t get the full amount. They ended up still having to pay about $3,000 of attorney’s fees in order to get $300. As you guys can see, the cost benefit analysis for you smart folks knows that is not probably the best course of action to have to try to enforce a contract that is poorly written.
I say that to say you guys need to have attorneys touching all areas of the business that I’ve outlined thus far, your setup, your contracts, intellectual property, working with others and all of that, so you can prevent issues, because I will lay money, your money, I will lay money that it’s cheaper and easier to do all of this in the beginning with an objective and legal eye on your stuff before you end up having an issue.
Let’s run through the quick steps that I have for hiring an attorney. First is for you guys to identify your needs. Shut off Facebook, shut off Instagram, shut off these groups online, and just sit and think about the needs in your business. One of the best ways to do this, because it will help you when we get to step number five, which is come prepared, but sit and write out all your workflow processes. Write out all the people that you’re working with, your business plans, your marketing plans. If you guys don’t have any of that, there’s other episodes that you need to go and listen to in order to get all that nailed down. The reason for this is you’re going to A, need all this when you go to an attorney because a good one’s going to ask for all this information. You’re going to have to come up with this information anyways, but this will help you by going through and getting organized and doing it now, will help you identify your needs.
I’m not telling you that you should just make a list, go to an attorney, and order off a menu. This way you can focus on some priority needs based on the goal, priority, and plans that you have for your business. Step number one is to identify your needs by writing out workflow processes, policies, et cetera. Two, ask for recommendations first. Please don’t just go blindly Googling. I’m going to tell you, and I’m an attorney, so I feel like I can say this about my kind, attorneys have the worst websites. They have the worst SEO. It really is easy to separate the wheat from the chaff when ti comes to not necessarily their best lawyers out there, but those that have the most money or know how to have better SEO. Don’t hop on Google and pick the one on the first page or the ads that pop up. Ask for recommendations first.
To me, this isn’t something that you can necessarily have redone. I just don’t want you guys to fall into the trap of falling victim to good marketing and them being not so good attorneys, because face it, all industries, we all have that, and lawyers are no exception that there’s people that are not necessarily the best. Number two is ask for personal recommendations. I personally like to ask on my social media from my friends, other business owners that I trust, as well as going to the local Chamber of Commerce and asking them as well.
Step number three is make sure you research the attorney and the firm. You’ve identified your needs. You have a scope. The majority of you that are listening to this, since you’re attracted to the content and the topic matters that I’m providing, the majority of you listening to this are going to need a business lawyer. It would be beneficial and I’m a little biased, but it’d be beneficial to have a business lawyer that works on contracts, business formation, and intellectual property. Since there is so much intellectual property intimately tied with running business, especially since we have this online sphere now that even brick and mortar business are having to fulfill a digital space on the web, make sure you research the attorney to ensure that they are in that type of business space. Please don’t take a general attorney or someone that only does wills and estates, then ask them to do a contract.
Yes, in theory, if you’re licensed by the Bar, we’re supposed to be able to practice all areas of law. We don’t necessarily specialize. However, there’s things that I wouldn’t touch with a 10 foot pole, even though on paper that I’m licensed to do it, it’s not my practice area and I haven’t kept up with the continuing legal education for that, so it would be malpractice for me to do it and would not be in your best interest. Research the attorney, make sure that they are on the up and up with the Bar. You can check for disciplinary things as well as licensures on ever state Bar website, and also make sure that they’re within the scope of the services that you need.
On top of that, please don’t just blindly hire one either. I recommend that you interview multiple attorneys or firms. This can sound a little difficult, especially when it comes to business and intellectual property type attorneys. We don’t work, typically, everyone’s different, all business are different, all law firms can be different, but typically, business lawyers don’t work under contingency and there’s not even a wide spread use of free consultation. That’s sort of stuff is typically tied to personal injury, criminal, family law, and those sorts of things. Adjust your mindset a little bit going into this and consider when you’re interviewing an attorney or a firm, even if you get a free or low cost consultation that’s going to be very small and narrow, make the most out of your time in order to interview them, because they’re also interviewing you as a client as well, but don’t be turned away simply because there’s not a free consultation amount or they don’t work on contingency. That’s not normal for these types of attorneys.
Interview the attorney firm. I always tell people, when my clients come in the door and we do our initial consultation, I go back to circling back to number one, was identify your needs. I tell them to verbally regurgitate everything that’s going on in their business to me. Of course, in our initial consultation that’s 20, 30 minutes, we can’t necessarily dig into every nook and cranny. It helps me as the attorney to get a good well-rounded view for multiple reasons. One, I can identify needs that you have may have missed. You can see if we are falling in line with the same priority needs, but it will also help me to better understand you, whether or not I can even serve you. I think that is very important when you’re interviewing an attorney. Make sure you find one who’s not just an order taker. Someone who’s not just going to say, “Now tell me what you want to eat.” They need someone who’s going to look at your stuff, pick through it, and make advisements, because that’s what lawyers are for, but not everyone is like that.
We also want to make sure that the person is comfortable and solid with the type of business that you’re doing. We really pride ourselves, and I definitely do, in telling a client when I don’t think it’s going to be a fit. Simply put, I may not have the knowledge on a specific subject matter. I would rather turn a potential client down during this interview process, which is our initial consultation, and refer them to someone else so they can get better legal help, than for me to make a couple bucks and it become a strained relationship. In fact, I’ve gotten a lot of referrals that way and so I recommend you guys, even if you have that in your industry, if a client comes to you and it’s not necessarily a job that you can do or think you can do well, refer them to someone you think can. I’ve received referrals from clients that I’ve actually never engaged, because when I’ve sent them to someone else, they appreciated the candor and the honesty.
The interview process is for you to interview the attorney. The attorney’s going to interview you as well and that’s step number four. Lastly, probably one of the most important out of this, is to come prepared. Templates, checklists, the outline of your needs. This circles back to number one. Super important to come prepared. The more information that you can give an attorney, the more well-rounded view they’re going to have, the less time that they have to spend asking for information, which in turn, can potentially lower the bill. For example, a couple of my brands, The Law Talk for Lawyers, Fit Legally for Fitness Professionals, and then Rachel Brenke had some generally industry documents. All of these, the intention of those legal templates is to take the knowledge and know how that I have in these industries so you guys can take those templates with you to an attorney.
You may go to an attorney who doesn’t understand the photography industry or how to run a Crossfit gym. You need to have those intricacies covered for you. Coming prepared with those templates can help to lend some more insight into what you’re wanting to have included, like in a document or steps to take. It can also potentially lower the bill because it’s less time the attorney and the firm have to spend soliciting and requesting information from you, and it provides a higher potential for a more well-rounded and better legal document and legal advisement in the end.
Guys, please don’t be scared from hiring an attorney. Please consider getting this done now. Please do not wait. One of the things is you can inquire to an attorney and you can get an assessment. This is another thing I should’ve said under number four, of interviewing the attorney or firm. Ask them how they do their billing. For us, I tried very hard because I know what it’s like to be a small business owner who has gone to a lawyer and then sat and twiddled my thumbs as the work was happening, worried about how large the bill was going to be. I would ask them what the hourly rate is and how many hours they think each task is going to take. I know they can’t hardcore set. Sometimes you get in, it can be a little bit more intricate than others, but it’s really important that you have an idea of how much that can be.
I like to break down within that interview process. I like to break down with the potential client how many hours each of the items may take, so that way they can prioritize monetarily. They can invest in the right priority needs, which then also circles back around to the foundation that you guys laid under number one of identifying your needs and that comes together in step number four when we’re interviewing one another to be able to see if we can work together and where to focus your financial and mental resources.
Again, identify your needs, ask for recommendations, research the attorney, interview the attorney and firm, and then also, come prepared as much as you can, and you guys will have a higher potential for success with an attorney. I highly recommend that you jump in to do this. Again, I don’t say this as a lawyer. I say this as a small business owner. I say this as a mother. I say this as a spouse. I say this as someone who wants to protect myself, and I would rather focus on sitting down with an attorney once or twice, relatively checking that box, it shouldn’t be a one and done, but relatively checking that box for six to eight months and then focusing on the rest of my business. Peace of mind, that is invaluable, there’s absolutely no reason that you guys shouldn’t reach out. If you’re having trouble affording this, skip over to other episodes. I’ll link it in the show notes at rachelbrenke.com/epi40. That way you guys can learn a little bit more about planning and budgeting, so you can stick things into line items so you can afford to get yourself legally protected.
Rachel Brenke is a lawyer, author and business consultant. She is currently helping professionals all over the world initiate, strategize and implement strategic business and marketing plans through various mediums of consulting resources and legal direction.