Resolutions for Clients and Counsel

Steeped in tradition, the age-old relationship between corporate America and its counsel is notable for high measures of trust, loyalty and longevity. The long-standing bond between businessperson and lawyer, while periodically frayed, has stood firm throughout changing business cycles, varying political climates and the march of time.

Mirroring society, however, the client-lawyer relationship has evolved over the past quarter century. Economic and societal shifts have resulted in both parties becoming increasingly demanding. Trust, loyalty and longevity are being tested more frequently than ever before.

With the goal of improving the time-honored ties between the business and legal communities, here are five resolutions for 2003 for legal service providers and those that retain them:

Know Your Client. Building trust through understanding sounds like common sense, but sometimes clients (or would-be clients) are taken for granted. Any sign that an attorney is not intimately familiar with those he is wooing or serving can end a relationship before it starts or cripple an existing one. This is important in our mobile society where personnel turnover at both law firms and client companies presents unique challenges to client retention.

Intelligence-gathering is not limited just to the initial pitch for legal work. Attorneys assigned to an existing client should be briefed not only on the matter at hand, but also on the principals involved, level of experience and managerial style. Familiarity with the client, its operations and internal policies is essential before any lawyer new to the deal attends his first client meeting. When an attorney asks questions, the answers to which have already been given to other attorneys on the matter, or would otherwise be obvious to someone who understood the client’s business, the result is frustration and confidence lost. Foresight and preparation can help avoid these potholes in the relationship road.

Help Your Attorney Help You. Tight deadlines are expected in a service business. The time I received a noon fax requesting immediate review of a contract to sell a major portfolio, I was ready to jump. Unfortunately, without a term sheet and relevant property information, a meaningful, complete review was stalled. The client is best served, and legal services are most efficiently provided, when time is taken to brief counsel on the relevant facts and circumstances pertaining to the transaction, business issue or dispute in question. The extra time spent briefing counsel fully at the onset will save time and expense in the long run.

Keep the Client in the Loop. Attorneys should keep the client up to speed at all times. Ask the client who its key people are and what information and materials should be distributed and to whom. Working closely in this fashion allows client and counsel to see the deal together, monitor progress and address issues as they arise. Plus, it helps avoid the 11th-hour fire drill to solve a crisis that need not have occurred. For attorneys, less is not more when it comes to client communication. Keep the clients fully apprised and let them draw the line on how much is too much.

Be Open to Advice. Some clients elect to bring in counsel as late as possible in a transaction and request only that a narrowly defined task be performed (e.g., close the deal). Whether due to sophistication, cost-cutting, or pride (or some combination thereof), the client may believe the issues and business terms are fully-developed and remain only to be implemented or executed. Clients employing attorneys in this limited manner do themselves a great disservice. It discourages counsel from rendering advice that may result in greater returns, cost savings or liability reduction. Experienced counsel adept at adding value through insight should be encouraged rather than perceived as second-guessing the client.

Adopt a User-Friendly Billing Format. When the legal bill arrives, the client rightfully wants to understand what exactly it is being asked to pay for. At minimum, clients want a clear recitation of who worked on the matter, each attorney’s hourly rate, the time spent and the work performed. An easy-to-read and informative bill will make both the client and attorney’s life easier. Clients cringe at narrative such as “Worked on deal/3.5 hours.” Attorneys strive to collect bills promptly. By issuing statements that are comprehensive and clear, all concerned will benefit, and trust and confidence will be promoted.

As in all relationships, clients and attorneys sometimes take each other for granted. Creating and maintaining any relationship requires an open mind and ongoing effort by all concerned. While the resolutions above touch on but a few key points, they are a start toward maximizing the mutual benefits that the client-attorney relationship can and should yield. Mitchell S. Berkey ([email protected]) is a partner in the New York office of Jenkens & Gilchrist Parker Chapin LLP. He concentrates on commercial real estate transactions, disputes and workouts on behalf of owners, managers, lenders and corporate real estate users nationwide. A member of GlobeSt.com’s Think Tank, Berkey has also served as vice president with Merrill Lynch Hubbard’s real estate asset management group.