Business Law

Starting a Business: Selecting a Good Lawyer

Starting a business without the advice of legal counsel could be one of the biggest mistakes you ever make. If you don't already have a lawyer representing your interests, a prime candidate to meet your needs would be a business lawyer with expertise on corporate matters and start up ventures. This checklist will help you find such a lawyer.

However, if you don't already have a lawyer, a great place to start your search for one is right here at lawyers.com. You can do a free search to come up with a list of lawyers by using the Find A Lawyer search box that can be accessed from anywhere on lawyers.com. (You should see a search box on the right side of your computer screen.)

Now do some initial screening to narrow down your list to three or four prospective candidates:

  • Look at the biographies and Web sites for the lawyers and their law firms. Does the lawyer appear to have expertise in forming business organizations (for example, corporations, partnerships, limited liability companies, sole proprietorships)? Does he or she profess to have expertise with start up ventures?
  • Look for a list of representative clients. Are they the types of clients that you would want your lawyer representing? Does the lawyer represent other businesses similar to yours?
  • Search on the Internet under the name of the lawyer and his or her law firm. Can you find any articles, FAQ's or other informational pieces that the lawyer has done that that give you a level of comfort?
  • Ask other people if they have heard of the attorneys and what they think about them
  • Contact your state bar association or go to their Web site to find out if the lawyers on your list are in good standing
  • Check out any advertisements you can find on a lawyer. For example, is the lawyer listed in the yellow pages of your telephone directory? If so, do you find the listing tasteful? (Most attorneys are listed in the yellow pages, but it is not as common to see business attorneys to place big advertisements there. You are more likely to find that they will advertise in trade publications specific to their areas or expertise, or they will try to get their name out by sponsoring charitable or community events.)
  • Check out the archives of your local newspaper. Has there been any publicity about the lawyer or the cases that he or she has handled?

Consider any special needs you have. For example, could you benefit from an attorney who speaks a language other than English?

There are basically two types of business lawyers: those who handle lawsuits (called business litigators) and those who primarily handle corporate and contract matters (called transactional lawyers). Some lawyers do both, but most of them tend to specialize in one area or the other. So if you are forming a new business, a lawyer who handles business transactions may be your best bet.

If you are starting up a small business where the ownership will be closely held, the organizational issues may not be too complicated and a sole practitioner or a lawyer in general practice may do a very good job in representing your interests. But it's worthwhile to try to look to the future needs of your business as it continues to grow. For example, think about retaining a lawyer or a law firm with expertise in areas that may better cover all of your anticipated business needs. It may be a good idea to look at a "full service" firm that does both transactions and litigation. It would also be to your benefit to have access to lawyers with expertise in other law areas affecting your business (for example, labor or employment law, tax law, real estate law, banking and finance or intellectual property).

You will probably want to hire a lawyer with at least a few years of experience. Look for lawyers that have experience in representing the type of business that you have or that you will be going into.

Look to see if a lawyer is affiliated with associations that cater to legal issues affecting businesses. For example, most bar associations have sections in business law and other related categories. Having a lawyer who is involved in a chamber of commerce or other local organizations may also be a good sign, depending on the your legal needs.

Unless there are special circumstances, you'll want to hire a lawyer who is licensed to practice law in your state and has an office located near your principal place of business. Special circumstances where you may have to go out of town would include a situation where local attorneys don't specialize in the area where you have legal needs, or where you're planning on expanding operations to another location.

Before you hire a lawyer:

  • Ask for references. You would want to talk to people who could comment on the lawyer's skills and trustworthiness. Get a reference from a bank and from other lawyers. A business lawyer should also be able to give you the names of several CPA's as references. Find out if he or she has previously worked with venture capitalists or other financing sources.

  • A great reference source for a good lawyer is word of mouth from other satisfied clients. After getting appropriate consents, lawyers will sometimes develop a list of representative clients that they'll use for marketing and promotional purposes, and you might ask a lawyer if it would be okay to contact some of these clients. (However, you shouldn't be surprised if the lawyer declines, as the attorney/client privilege binds lawyers to strict rules of confidence with respect to client matters. Indeed, it may even cause you to question whether the lawyer would keep your legal matters confidential if he or she volunteers too much information about other clients.)

  • Ask about conflicts of interest. Does the lawyer represent any opposing parties? Does the lawyer represent any of your potential competitors?

  • Ask for a copy of a firm brochure and promotional materials that the firm may have. Crosscheck these materials against your other sources and references.

  • Ask to be provided with a copy of the lawyer's retainer agreement and have it explained to you before decide on retaining the lawyer or the lawyer's law firm. You may end up paying a lot of money to the lawyer you retain, so make sure you understand what you're signing up for.

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