The body of law that surrounds and intersects with businesses in the United States is vast. Like private citizens, businesses can be subject to both criminal and civil law. Businesses must utilize attorneys to complete certain transactions. Businesses are also more prone to violations, whether those violations are of a criminal or civil nature. This is partially due to the scale of most businesses, the types of interactions they have, and the greater exposure of businesses to a variety of instances that may create legal liability. The vast majority of law that businesses interact with falls under the umbrella of civil law, which will be the focus of this article.
Business lawyers are adept at navigating complex business litigation, streamlining transactions, managing risk, and assisting clients in creating effective business structures. Alongside these core tasks, business lawyers provide a number of services to clients that can add value to a client’s business. In this article, we’ll explore some of the main reasons that a business should consider hiring a business law firm. There are times when legal counsel is critical. Recognizing the situations where a business lawyer can bring extra value to your company or help avoid legal problems is an increasingly important aspect of running a successful modern business.
Core Competencies of Business Lawyers
Exploring some of the core competencies of business lawyers can provide insight into the vital role they play for businesses. The American Bar Association recently outlined the core competencies of business lawyers. Understanding these competencies can also assist you if you are wondering how to hire a business lawyer and what types of skills a business lawyer should have. First, business lawyers must be knowledgeable about the body of law that affects clients’ businesses. This includes statutes and regulations at the local, state, and federal level. Business lawyers must keep abreast of regulatory or policy changes that may impact their clients’ businesses. Business lawyers must also understand business itself. Successful business lawyers must understand how businesses are run, how they remain profitable, and in particular must be knowledgeable about specific client businesses.
Excellent business lawyers are adept at analyzing risk for clients and framing both risks and available choices in ways that are relevant and easy to understand. Business lawyers must understand risk from the perspective of the business, and outline strategies and choices for the business to avoid or mitigate risk. Business lawyers must understand exactly what risks clients face, what the probability of a negative outcome given those risks is, and what alternatives a client might have that might minimize risk. Risk management is a core component of a business lawyer’s job, and highlighting the risks that a client may face is crucial to both the long-term success of the business and the relationship between the business lawyer and client.
Business lawyers must be skilled problem solvers. A core competency required of business lawyers is the ability to grasp the thrust and scope of a problem and determine solutions to that problem. Business lawyers add value to businesses by helping to navigate difficult legal matters that may result in liability if not approached correctly. In order to serve as effective problem solvers, business lawyers must understand the context of client business operations, and the goal of any transaction in which a client is engaged. In a transactional setting, a business lawyer must work to facilitate a favorable outcome for the client, which often requires some level of financial literacy, familiarity with the client’s business, an understanding of the desired objective, and the ability to assess and recommend alternative routes to achieve the client’s objectives.
Business lawyers must also have the ability to identify and diagnose problems. In doing so, business lawyers must understand issues faced by a business from both a business and legal standpoint in order to find ways the allow the business to achieve its objectives without running into legal issues. In order to do this effectively, business lawyers must be able to clearly identify the nature of the client’s needs, maintain perspective of the overall objective, recognize when problems are of a legal nature and when they aren’t, and come up with realistic and viable alternatives and strategies for the clients.
In addition to each of the aforementioned competencies, business lawyers must be skilled at legal analysis and critical thinking. Business lawyers must understand and master law relevant to issues faced by their clients. The important thing is that business lawyers must be a master of their chosen field of specialty, and use that mastery to formulate relevant legal approaches in the event of litigation. A business lawyer specializing in contract law would have a wide-ranging and detailed knowledge of opinions, regulations, statutes, or judicial opinions that may affect their client.
Hiring a Business Lawyer
Hiring a business lawyer is a big step for a business owner, and hiring a business lawyer at the right time can be crucial for the success of a business. That being said, it’s not always clear when you need to hire a business lawyer and when you can complete the work yourself. Let’s take a look at some instances where hiring a business lawyer is always a good idea.
If your business is subject to any form of litigation it is imperative to hire a business lawyer. A business lawyer can help you determine potential liability, formulate and coordinate a legal strategy, and represent you during trial. Common areas where litigation against business occurs are employment or wrongful termination, discrimination and harassment, and environmental law violations. The reality is that the best defense against litigation is a comprehensive risk management strategy. In an ideal world, a business will meet with a lawyer prior to any litigation, and map out areas of risk. Pre-emptive risk analysis allows businesses to identify key areas of potential liability and shore up any shortcomings. A key strength of business lawyers is identifying and communicating risks. Work with your business lawyer before litigation occurs to ensure that you limit your vulnerability for litigation.
Forming a Corporation
If you are going to form your own corporation, it is a good idea to hire a lawyer. While forming a corporation on your own is possible, the process can be extremely complex. A business lawyer can help ensure that your corporation is set up as efficiently as possible. Business lawyers can provide insight into strategies to reduce costs, and ensure that your tax and legal requirements are met. This reduces your exposure to significant legal trouble in the future, while also allowing you to structure your corporation as efficiently as possible for your specific needs and business objectives.
Buying or Selling a Business
Buying or selling a business can be complex. To guarantee that you do it correctly, be sure to hire a business lawyer with extensive experience in the acquisition and sales of businesses. There are a number of issues that may arise during the sale or purchase of a business, for which legal advice is recommended. This includes situations in which a business has outstanding debts that must be divided or transferred, or where you want to maintain continuity with previous clients and contacts of the business being purchased. A business lawyer is also crucial during the due diligence phase of a business purchase. During this phase the buyer is able to examine exactly what he is she is buying. A business lawyer can provide insight during this process, and point out any flaws or warning signs that make it an unwise purchase. When selling a business, the seller’s attorney is responsible for drawing up all closing documents and ensuring the closing transaction goes smoothly. Taking advantage of a business attorney early on in the selling process will allow them to assist you in negotiations, and avoid any potential problems down the road.
To learn more about how a lawyer can help your business, contact an experienced Commercial and Business litigation attorney at Bremer Whyte Brown & O’Meara LLP.