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How do I choose a legal adviser for my business?

This article looks at the importance of having good legal advice as a business owner and how to go about selecting the right adviser for you. 

Why do I need a legal adviser?

Most businesses will need legal advice at some point. Some may need advice even before they have started to trade.  

For example advice may be required when: 

  • a business takes over the running of an already established business. It is wise to have an agreement in place drawn up by a solicitor
  • you are taking on staff. You will want to have employment contracts in place before you take anyone on.

There may be occasions where you feel you can do your own research or ask contacts for advice instead of paying a solicitor.

For example, you may have had a dispute with an employee or a supplier. You need to consider whether your time as a business owner is better spent trawling the internet trying to find solutions yourself and asking people you know for advice who have been in similar situations, or would it be more cost effective to instruct a legal advisor to deal with the case while you carry on working and have clarity over the advice given?

Taking legal advice early can be crucial to the success and continued growth of your business.

Having detailed contracts in place with employees, landlords, suppliers and customers from the start means that you are in a much better position should any disputes occur.

You can of course always seek legal advice after a dispute however without any written agreements in place your representative faces a much harder task trying to win your case. Not only that, but it will require a lot more of their time which will be much more expensive for you!

What types of legal advice may I need?

There are a number of events during the course of running a business which may require you to seek legal advice. And some are more straightforward than others.

Unhappy customers

There may be occasions when a customer is dissatisfied with the work you have done or the service you have provided and hold you accountable for financial losses they have suffered as a result. In cases like this it is important to seek legal advice, as trying to defend yourself could leave you exposed legally and may result in you having to pay large amounts of compensation or even put you out of business.

Protecting your assets

Some businesses have a higher risk of customer disputes than others. A company which hires cars and vans for example should have a detailed customer contract in place in the event of damage or theft caused by a customer.  

Changing suppliers

For example you may want to change the supplier who collects your waste each week, but the current supplier has told you that you are tied in to a two year contract or that you have to pay a substantial fee if you want to move. Again, this is something that you really don’t want to spend operational time dealing with and would be much better to instruct a solicitor to provide guidance instead.

Employment contracts

Drawing up employment contracts is something a solicitor would be able to do fairly quickly but having it done professionally puts your mind at rest should there be a dispute between an employee and yourself. Having contracts in place means that you can go about disciplinary action the right way, and even dismiss an employee provided you have followed the correct legal procedures. The absence of any contract could mean an employee taking you to court for unfair dismissal.

Pre-existing agreements

It may be that you require your own independent advice on an agreement already drawn up. You may lease premises and you would like your own legal advisor to check the lease agreement before you sign it as these can be quite complex so this will give you reassurance and will ensure you are not agreeing to anything you shouldn’t be.

Protecting your idea

A more complex area where legal advice is crucial is intellectual property. Intellectual property is the inventions, designs and ideas of an individual or a business and must be protected for the benefit of the creator. Seeking legal advice early on can ensure that the creation has a patent to prevent copyright and ensures that there is financial compensation for the creator should a rival copy the idea.

Disputes with directors and partners

If you are in business as a limited company and there are other directors, or if you are in a partnership, it would be advisable to have a contract drawn up between all the directors and partners of the firm. Whilst you may all get on well and work well together at the beginning, who knows what can happen in the years to come. One partner may feel another is taking more money out of the company than he should, another may feel he is being overruled on key decisions and what happens if one partner decides he wants to sell his share of the business to an outside party? These are all areas that a solicitor can provide guidance on.
Unhappy customers

There may be occasions when a customer is dissatisfied with the work you have done or the service you have provided and hold you accountable for financial losses they have suffered as a result. In cases like this it is important to seek legal advice, as trying to defend yourself could leave you exposed legally and may result in you having to pay large amounts of compensation or even put you out of business.

Protecting your assets

Some businesses have a higher risk of customer disputes than others. A company which hires cars and vans for example should have a detailed customer contract in place in the event of damage or theft caused by a customer.  

Changing suppliers

For example you may want to change the supplier who collects your waste each week, but the current supplier has told you that you are tied in to a two year contract or that you have to pay a substantial fee if you want to move. Again, this is something that you really don’t want to spend operational time dealing with and would be much better to instruct a solicitor to provide guidance instead.

Employment contracts

Drawing up employment contracts is something a solicitor would be able to do fairly quickly but having it done professionally puts your mind at rest should there be a dispute between an employee and yourself. Having contracts in place means that you can go about disciplinary action the right way, and even dismiss an employee provided you have followed the correct legal procedures. The absence of any contract could mean an employee taking you to court for unfair dismissal.

Pre-existing agreements

It may be that you require your own independent advice on an agreement already drawn up. You may lease premises and you would like your own legal advisor to check the lease agreement before you sign it as these can be quite complex so this will give you reassurance and will ensure you are not agreeing to anything you shouldn’t be.

Protecting your idea

A more complex area where legal advice is crucial is intellectual property. Intellectual property is the inventions, designs and ideas of an individual or a business and must be protected for the benefit of the creator. Seeking legal advice early on can ensure that the creation has a patent to prevent copyright and ensures that there is financial compensation for the creator should a rival copy the idea.

Disputes with directors and partners

If you are in business as a limited company and there are other directors, or if you are in a partnership, it would be advisable to have a contract drawn up between all the directors and partners of the firm. Whilst you may all get on well and work well together at the beginning, who knows what can happen in the years to come. One partner may feel another is taking more money out of the company than he should, another may feel he is being overruled on key decisions and what happens if one partner decides he wants to sell his share of the business to an outside party? These are all areas that a solicitor can provide guidance on.

How much do legal advisers charge?

As with any other company providing a service this varies. Traditionally, solicitors charge their time by the hour, however if you feel you may need advice on a regular basis it may be more beneficial to negotiate a fixed monthly fee which allows you to seek advice as and when you need it. You can stop this arrangement, or at least reduce the monthly fee, once you start to need less input from your solicitor.

Do not be afraid to discuss fees with a solicitor before you agree to use them. You wouldn’t buy goods from one of your suppliers without first agreeing a price, so using a solicitor or any other professional organisation should not be any different.

A good solicitor will be transparent from the outset about what they will charge and how much the whole assignment is likely to cost. It is not always possible to put an exact figure on a case until it is known how much work is required, but by asking before the work starts you will at least have a rough idea.

The type of work and the skill levels involved will have a bearing on the fees. Some work which can be done by junior staff could cost around £75 per hour, more complex cases which require the expertise of more senior staff, or even partners, could be in excess of £200 per hour.

How should I choose a legal adviser?

As with choosing any other supplier it is often a good idea to ask around amongst friends, business contacts and those in the same industry as you to see if they can recommend anybody. This can often be much better than simply searching online and using someone you know very little or, if anything, about.

You also need to consider the type of service you require. You may be looking for advice in a specialist area, in which case you may need to do more research to find the right company. 

Many established businesses have a firm of solicitors with whom they have built up a relationship over a number of years. But every relationship like this has to start somewhere so be sure to spend time finding the right firm. You may arrange meetings with a few different firms and then decide which one best suits the needs of your business.

Although you may build up a good relationship with one company, there may be times when you feel that the work you require needs more specialist advice which you can get elsewhere. It is worth looking at each piece of work and choosing the firm you feel is best equipped to do that work.

Location is important, although it is more common now for less work to be done face-to-face. You may only communicate with your advisor by phone or email in which case it doesn’t really matter where they are based as long as you are receiving the right service.

To find a solicitor visit the Law Society’s website here. There Find a Solicitor is a free service for anyone looking for information about organisations or people providing legal services in England and Wales that are regulated by the Solicitors Regulation Authority (SRA). 

Checklist: Choosing a legal adviser

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