Client Empowerment 3: Advice you need from your lawyer
In my last blog post, “Finding the Right Lawyer,” we focussed on making sure you get to a lawyer with the right skill set for your legal matter. In this post, we will focus on making sure you get the right advice.
Recently, John, a client, came to visit me. He wants to invest $5,000 in a start-up business and asked me for the cost and process to form a corporation and document the deal with his partner. I was the third lawyer he interviewed. John tells me what he tells the other lawyers, that he is looking for the quickest and cheapest way to do this. Both lawyers quote John very reasonable prices and explain the rather straightforward incorporation process. They are giving John what he wants. He is happy, or I should say, blissfully ignorant.
The problem is that what John says he wants is not necessarily what John needs. When John gets to me he’s hit with a barrage of questions. Together, John and I discover that John’s proposed structure with his partner is not optimal for either of them and that John has grossly undervalued his start up costs. Without proper capital, the business is doomed to fail. And, even if it succeeds, John will be stuck in a Delaware corporate structure when he really needs a New York limited liability company.
Before any paperwork is done, you need your lawyer to help you take a step back and look at the big picture. As I discussed in Client Goals 3: What You Need Your Lawyer To Tell You, getting critical advice could make a huge difference in your business and life. Your lawyer should help you identify your goals and uncover the concerns. Your lawyer should be helping you strategically think through the partnership you’re about to get into so you are crystal clear on what role you want to play in that business. As an end result, you can set realistic expectations of the business and manage them appropriately.
When dealing with such potentially complicated matters as business investments and large amounts of your money, the attorney you hire needs be a strategic business thinker and not just a person that will implement legal paperwork.
What are your experiences with lawyers in the past and how would you have improved them?