Translating Your Legal Skills Into Client Service

Get to know and understand the client’s business
 

A client's goals and expectations do not exist in a vacuum. Client expectations arise from real business objectives, opportunities, operations, problems, company idiosyncrasies, and psychological needs. Just as the practice of law involves terms of art and familiarity with a particular court's perspective, other businesses have their own specialized customs, terms, and acronyms. Lawyers who desire to translate their legal skills into excellent client service must become appropriately familiar with the client, and the client's company and industry. This familiarity serves three purposes: (1) conversance with the client's language, perspective, and strategies; (2) recognition and analysis of problems peculiar to that business; and (3) anticipation and understanding of the context and trends shaping the client's goals, priorities, and frame of reference. The degree of familiarity needed varies for regular or full service and for transactional legal service.


CONSIDER:

A client manufacturing company pays royalties to the licensor under a contract that the lawyer drafted two years ago. In the contract, the royalty percentages are lower for goods which are sold at a discount, up to a certain volume of sales. The volume of discount sales that qualifies for the lower rate was close to the company's actual volume of discount sales at the time the contract became effective.

The company's vice president of finance has just conducted an analysis of profit margins for each of the company's lines. Recent competitiveness in the industry has forced more design risks than ever before and, therefore, many of the goods will be sold at a discount. The company wants to continue doing business with the licensor but wants its relationship to reflect these changes in the industry. The contract is about to expire and the president sends it to the lawyer, requesting that he "update the contract."

Actual result

The attorney revised only the expiration terms in the contract and sent it over to the company for the president's signature. The president gave it to the vice president of finance to review.

What went wrong?

The lawyer failed to consider information and perspectives he had gained from other projects regarding the impact of increased competition upon the company. He also failed to consider adjustments he knew the company was making to maintain its market strength. The attorney should have conferred with the client to determine its current goals relative to this contract and to develop a creative contractual solution to increase either the volume or categories of discount sales that would qualify for the lower royalty rate in exchange for a concession in another area.

How can you develop your practical knowledge about a client's business and industry? If the client is a publicly held company, read over its annual report, financial statements, proxy disclosures, and so forth. For example, you can learn about the background of each member of the board of directors from information contained in proxy disclosure material. To gain knowledge of an industry's chief executive officers [CEOs], practices, problems, and trends, and to amass information about your firm's clients and their competitors, peruse local business magazines and newspapers, national business magazines, industry trade journals, the Wall Street Journal, the business section of the New York Times, and similar publications. Becoming familiar with an industry will also help you to recognize marketing opportunities later as you undertake business development responsibilities.

A third year associate in a firm that represents a number of hospitals and physicians developed a personal program to gain more practical knowledge about the health care industry; it may provide some ideas. Over a three month period, the associate planned to: (1) list friends and acquaintances who are employed in or who service this industry, such as those holding positions in hospitals, pharmaceutical companies, health maintenance organizations [HMOs], public relations people, brokers, and bankers; (2) contact these people and learn their opinions about the industry's technological developments, current practices, concerns, and trends; (3) learn industry jargon; (4) discover which industry associations are composed of upper and middle management people — those who are decision-makers and influencers in purchasing legal services; (5) attend an industrial association meeting with an acquaintance who belongs to that association; and (6) subscribe to a leading trade newsletter or journal.

Modest though these steps may appear, they enabled this associate to develop information and a net-work of resources within the health care profession. When meeting with a client, this associate can now comfortably discuss various developments and concerns affecting the client, the community, and the industry. The associate can also demonstrate familiarity with the way the client conducts business, to reinforce the client's confidence in the firm team. These efforts will serve as the foundation for recognizing opportunities for marketing the firm's services in the industry when developing an individual marketing action plan [MAPSM].

Occasionally it is desirable to visit the client's offices to gain an appreciation of its business cycle, working environment, and operational structure. Many senior executives and entrepreneurs are delighted when outside advisors see "their team" in action. A vice president of finance for a manufacturing company put it this way: "I want lawyers and accountants to come to our plant and see what kind of a monster I'm driving!" Given the positive reception and results of such trips, many executives are expecting — if not demanding — such attention. Therefore, if you have been working directly with your counterparts in a client organization, consider the appropriateness of arranging an on-site meeting or visit.

Sometimes, of course, a trip to an adversary's plant is a crucial part of preparation. In one situation, a lawyer defending a contract claim concerning component parts the client supplied to the plaintiff visited the plaintiffs manufacturing plant. As a result of this trip, the lawyer found some holes in the plaintiffs case and developed a creative trial strategy that resulted in a substantial reduction of that plaintiffs recovery.

APPLYING THIS EXPECTATION TO YOUR RESPONSIBILITIES

Acquire practical knowledge about key client businesses and industries, including:

Industry trends affecting client objectives.

Problems particular to that industry.

Business and financial jargon.

Products, services, market shares, industry leaders. Gather insight and information from peers in the industry. Become familiar with industry associations and trade journals.

Know and tell the client the practical aspects

Inexperienced attorneys often overlook a central client expectation: that the attorney will view the client's objective or problem from several angles, grasp the essence of the matter, and develop workable options to achieve the result desired. Workable options are grounded on practical, as well as legal, considerations. ABA Model Rule 2.1 recognizes this: "In rendering advice, a lawyer may refer not only to law but to other considerations such as moral, economic, social and political factors, that may be relevant to the client's situation."

An ability to cut through tangential issues quickly and incisively is particularly crucial where the matter requires prompt attention and managing momentum is paramount. Thoughtful inquiries and sensitivity to the practical ramifications of legal advice foster a useful work product for both the supervising attorney and the client. Too often new attorneys, unskilled at viewing an objective from the client's perspective, launch into a detailed analysis of legal issues but fail to focus on the client's goal or problem. This tendency has been described by the well-worn phrase, "These are the subtleties in which only lawyers get lost."

CONSIDER:

A client who represents various auto parts manufacturers asks his attorney to analyze a proposed arrangement between a group of wholesale "jobbers" and himself. The client wants to set up contracts with the jobbers for purchasing parts from his various manufacturers. The proposed "full service purchase con-tracts" would allow the jobbers to purchase the parts at a special discount so long as they use only the manufacturers connected with the client.

The attorney advises the client against undertaking this business arrangement with the jobbers because the contracts would likely be construed as tying arrangements in violation of antitrust laws. The client's unspoken and unhappy reaction is: "My attorney does not understand that this is a valuable business opportunity. Surely there is a way to do it." To do what?

What went wrong?

Because the attorney viewed the problem as an isolated legal question, he was oblivious to the value the client placed on having a relationship with these jobbers. The attorney's "advice" made legal sense, but business nonsense.

What alternatives to a binding contract would accomplish the client's goal of encouraging the jobbers to do most of their business with him? The attorney could have asked the client what types of incentives would attract the jobbers. After discussing how the client might provide value to the jobbers, the attorney might have suggested and then structured an incentive arrangement to accomplish the client's purpose with-out running the risk of violating antitrust laws.

Comment:

Suppose, for liability reasons, a client prefers a limited partnership to run a family real estate operation. During the discussions, the client mentions that the family members are very close and confer about most business and investment options before making any decisions. The lawyer should ask whether the family members who would be limited partners would be content to leave the day-to-day affairs of the business to the full partners to manage.

In these situations, you must pay attention to both the practical and the legal considerations. Note also that the lead counsel will frequently recommend to the client that they consult another professional advisor for an assessment of factors related to that professional's area of expertise. Examples of consultants that may be needed include: an accountant to help determine the costs of a undertaking a project and/or the costs of delays in its completion, an appraiser to help in evaluating a purchase price, and a construction expert or an engineer to help determine the feasibility of a scheduled completion date for a project.

APPLYING THIS EXPECTATION TO YOUR RESPONSIBILITIES

Anticipate and consider the practical ramifications of each alternative strategy and of your recommendations. Check to ensure they are consistent with:

Client's business objective.

Client's evaluation of what is at stake.

Learn to see the related problems

Lawyers must continually evaluate whether and how legal issues outside of their "practice areas" affect a transaction. For example, a bankruptcy lawyer's role in corporate policies and strategy may extend to tax, real estate, labor relations, and transactional work such as acquisitions and mergers. New lawyers often must train themselves to become sensitive to this expectation because law school courses generally do not train students to spot problems outside of the subject matter of a course. Indeed, law students studiously ignore substantive or procedural issues beyond the purview of the course: professors do not give points for discussing tort issues in a contracts final exam. Conversely, an attorney must focus both narrowly and broadly on the client's objectives to recognize related problems. The ability to recognize companion or tangential problems is as often dependent upon understanding the context of a client's concern or question as it is a function of paying attention to the details of a transaction.

Periodic in-house continuing legal education sessions held by firm members from other practice areas help attune inexperienced lawyers to recurring interrelationships among practice areas and to formation of new informal working or practice groups that specialize in specific client needs or transactions. For example, servicing entrepreneurial high technology businesses and businesses engaging in international trade requires a team that cuts across traditional departmental boundaries.

APPLYING THIS EXPECTATION TO YOUR RESPONSIBILITIES

Become familiar with interrelationships among practice areas on key types of client matters.

List recurring client objectives, problems, and issues which cut across those areas of legal expertise.

What are effective methods of coordinating team work among practice areas?

Create sensible and responsive solutions

Clients expect their attorneys to find ways to achieve their goals or solve their problems. When a client asks if something can be done and the lawyer determines that it cannot, the next question — whether or not articulated — usually is, "Then, how can I do it?" A client's objectives or problems seldom are tidily packaged; instead, client priorities, preferences, and factual circumstances demand creative thought through-out the process to determine workable options and to reach the best solution.

Creative problem solving is not synonymous with taking shortcuts in legal research and analysis. The creative lawyer is just as thorough and as meticulous as his or her colleagues. The creative lawyer, however, listens to the client carefully during the engagement process to understand what the client wants to do, maintains a consistent focus on the client's overall objective and priorities, communicates with the client, and then designs a responsive, workable solution.

CONSIDER:

A lawyer represents a client who is forming a corporation in which she owns 60 percent of the stock. The client wants to control the day-to-day operations but she also wants to motivate the minority shareholders to take an interest in planning major corporate policies, such as new markets and growth issues. The client asks the lawyer to design a mechanism to help accomplish both of these objectives. How would you draft the majority and minority voting rights to achieve this result?

A Solution:

The lawyer drafts a provision that requires only a simple majority of stock ownership for a vote to set the number of directors and to elect them. A 75 percent vote is required on certain other significant issues. The lawyer confers with the client to develop a list of these significant issues and then attends the meeting in which the client and minority shareholders agree on the issues. This solution enables the client to run the day-to-day operations; the voting rights design ensures that the client can continue business operations even if there is a disagreement among shareholders. The design also encourages the minority shareholders to maintain their interest in addressing the policymaking and strategic planning aspects of the business because their votes are required to change or implement certain policies.

APPLYING THIS EXPECTATION TO YOUR RESPONSIBILITIES

Adopt a can-do attitude.

You can more effectively develop responsive, workable solutions if you:

Step back periodically. Ask yourself why you are doing what you are doing.

Question your assumptions.

Devise and assess alternative means to reach the client's goal.

Consider cost-effectiveness as well as risks of each alternative.

Keep in mind the economic cost

Clients expect that their legal matters will be handled efficiently as well as effectively and that their lawyers will think in terms of what makes sense economically — that is, "How long will it take? How much will it cost?" No longer satisfactory, with limited exceptions, is the attitude "do the job well regardless of cost." Many clients may be unfamiliar with technical legal nuances, but they do know when the numbers work and when they do not make sense. Usually a client is not interested in attaining an "optimal result at all cost." If the client refuses to pay or the responsible attorney cuts inappropriately spent time, the firm will pay for that written-down time.

Establishing the ground rules for an engagement during the engagement process goes a long way toward preventing unpleasant surprises later because of assumptions the client has made about "how long it will take" and "how much it will cost." Adhering to the terms in the engagement letter and contacting the client when departures from prior estimates are needed is one way lawyers demonstrate to a client their economic sense in concert with professional judgment in day-to-day work. This must be coupled with sensitivity to the client's need to control fees and costs. If a fee or engagement letter is available, its terms may cover several areas that provide the context for the new lawyer's assignment. These areas may include:
 

• Objective
• Scope (and limits) of service
• What is expected of the client
• Particulars of the fee arrangement
• Staffing requirements, qualifications, and billing rate(s)
• Arrangements for billing expenses — retainer; third party to bill client directly; include in regular bill or bill separately from fees
• Payment terms — billing interval; service charge

Lawyers are expected to watch and monitor the cumulative cost-effectiveness of time spent and expenses in light of estimates of the probable amount of recovery, the amount in controversy, the budget allocated to the matter, or the value to the client of reaching the objective according to an appropriate measure — cash? Present value? This does not mean to apply a cut and dried formula, but rather to consider the problem from the client's perspective while assessing what actions and strategy are most cost-effective.

If the associate's path to the desired objective or result becomes less cost-effective than was earlier discussed, it is up to him or her to inform the supervising attorney. See 6.05 [Part II, Expectation No. 6: "Communicate Progress and Status"]. Then the supervising attorney, together with the client, can timely reassess the value of the goal, and consider alternative means of reaching it. They can also discuss the appropriateness of modifying the goal.

CONSIDER:

A law firm's assignment is to evict several delinquent commercial tenants and to pursue collection of rents. The assigned lawyer discovers that the efforts against one of the tenants have become more costly than projected and alerts the supervising attorney, who in turn alerts the client. The client and supervising attorney review the status of each of the cases and the overall budget, and evaluate whether to continue recovery efforts against that tenant.

Here, the client appreciated the lawyer calling the issue of cost to his attention; had the client discovered the problem on the statement of fees when the costs were out of balance with the projected amount of recovery, the client could have concluded that the supervising lawyer had little financial sense, did not manage the cases, or was interested in only one thing: billing time — fees — regardless of whether continued work made sense to the client.

Clients expect their bills to reflect the value of the lawyer's efforts. Good clients object to and resent fees for which there is little demonstrated increase in value. Without some explanation by the lawyer, the client who is uninvolved in the day-to-day activity may not recognize the significance of each activity — meetings, memoranda, telephone calls — and how they collectively contribute to reaching the objective or solving the problem. Consistent communication of effort and progress made should eliminate surprise when the client reviews the statement for professional services.

When describing your time, put yourself in the client's place. If you were paying for your services, how would you best describe them? Clients want to see descriptions of items that they, as businessmen, understand. Also consider the billing attorney: he or she needs to understand what work you have done to determine how to bill it. A concise description that requires little rewording will be appreciated, if not expected.

The lawyer can also provide guidance by making periodic telephone calls, by writing notes on copies of correspondence sent to the client, and by sending and discussing status reports shortly before the client receives a bill. A lawyer has an obligation to evaluate the relative cost-effectiveness of allocating firm resources and outside resources in a matter. Examples include comparing the costs and relative value of available experts, carefully assessing whether more than one lawyer is needed at a meeting, hearing, or deposition, and cost-effective use of legal assistants, computerized research, automated litigation support, and so forth.

CONSIDER:

You are assigned work for both a corporation and, personally, for its chief executive officer, the majority shareholder. You are aware that minority shareholders in this closely-held corporation have fought with the managing majority shareholder during the last two years over a variety of issues, including the reasonableness of certain major expenditures.

How would you describe your time for the services performed for the corporation and the services per-formed for the CEO?
In this case, the associate clearly delineated time spent on corporation business and time spent on the CEO's personal matters. This enabled the billing attorney to easily prepare a separate bill for the personal work to discourage any suggestion by a disgruntled shareholder or the IRS that the CEO did not distinguish personal legal work from corporate legal work. The separate bill was used by the bookkeeping department to calculate additional W-2 income for the CEO. The billing attorney also wrote a cover letter transmitting the bill, which explained why separate bills were prepared.

The advice an attorney gives to a client must make financial sense to the client in the context of that client's business or personal affairs. If the client expects little available cash for the remainder of the year be-cause of expansion plans, then structuring a real estate acquisition that contemplates cash to finance a large portion of the price would be incompatible with the realities of the client's financial situation and other plans. If the lawyer asks questions and focuses on the financial picture, other means of acquisition can be explored, such as an exchange of properties.

CONSIDER:

A manufacturer needs to purchase raw material requirements on credit for the next six months. You are involved in structuring the credit arrangements with a group of banks.

What would you ask about the industry practice, the company's past and existing arrangements, and the banks' position on payment for raw materials?

Comment:

In this case, payment was required to ship each or-der. A postponed shipment because of delay in payment would have disrupted manufacture of samples for the largest seasonal trade show. The lawyer who handled this transaction obtained this information along with the requirements for cumulative credit for the next six months. The lawyer recognized that the negotiations had to be completed before the first scheduled shipping date of the raw materials. This lawyer demonstrated practical financial sensitivity to the imperative of shipping on time to avoid jeopardizing the marketing of the seasonal product.

APPLYING THIS EXPECTATION TO YOUR RESPONSIBILITIES

Comply with terms of the engagement/fee letter.

Monitor cumulative cost-effectiveness of your efforts and expenses in reaching the objective.

Notify the supervising attorney if you find your course of action will exceed estimates or is becoming less cost-effective than was discussed. Be prepared to propose alternatives, as appropriate.

Prepare billing descriptions that make sense to the supervising attorney and client.

Learn how to be a resource to the client

In the typical attorney-client relationship, the attorney is called upon to service clients on an ad hoc or transactional basis. There are times, however, when a client wants the lawyer's expertise as a resource or sounding board for preliminary ideas or strategy. For example, an entrepreneur offers financial services to clients. He does not want to internally staff certain professional positions because their advice is not required daily. Outside advisors, including attorneys, are well suited to serve as resources, however, because of their independence and exposure to creative planning opportunities. So the company retains a team of experts representing various professions to ensure that its clients receive the best thinking on all aspects of a proposed financial design. The team consists of an attorney, a CPA, an actuary, a financial analyst, and a management consultant. As a primary resource, the attorney's value and role is to evaluate ideas and to brainstorm preliminary design ideas from a practical as well as a legal perspective. This allows the company's management group to think through ideas early on, eliminate unworkable approaches, and to focus on those with merit. Later, in the process of refining a proposed plan, the attorney is again called upon to analyze specific elements and to prepare the documents.

CONSIDER:

A financial corporation decides to establish a program to help its employees prepare for retirement. The employee relations department designs a two-day seminar to cover various retirement planning areas, and puts together a panel of speakers to address each area. The speakers include a representative from the Social Security Administration, a physician, an in-house employee benefits analyst, an insurance representative, a financial manager, a retired employee, and an estate planning attorney.

Comment:

The estate planner should contact the in-house employee benefits analyst to become familiar with the company's retirement plan and any other relevant benefits so that the presentation can be tailored to address the practical questions and concerns of that group. This project serves as a marketing tool because some employees may need specialized advice, wills, or trusts. (The attorney may speak for a fee or may intend it solely as a promotional opportunity.)

APPLYING THIS EXPECTATION TO YOUR RESPONSIBILITIES

Observe how the supervising attorney serves the client as a

Resource.

Sounding board for new ideas.

How does the supervising attorney "add value" to the relationship by serving in this role?

Knowledge sharing with the client

Successful clients strive to remain on the competitive edge of legal developments and techniques affecting their businesses. Thus, every attorney has a direct interest in informing his or her clients about new developments and techniques. Through such efforts the attorney can effectively build and maintain client confidence. Regularly updating clients reduces the possibility that information is miscommunicated by a colleague on the golf course or, worse, that the client learns of important information first through a loss to a competing company.

Learn to be sensitive to even the most casual inquiries by clients about legal developments, new legislation, or new techniques affecting their businesses. When a client expresses curiosity about or interest in pending legislation, use your own follow-up system to keep the client informed by telephone, personal correspondence, firm newsletter, or firm seminar. Similarly, a supervising attorney may assign legislative tracking or follow-up to you.

Communicate information in terms of opportunities or solutions to problems. You may have written an internal memorandum about new legislation, a new case, or a planning opportunity, or recently briefed an issue of general interest to a client. Consider whether circulating this information to clients would be appropriate (after deleting any confidential references). This technique serves a marketing function as well. The information you circulate may be useful to lawyers in a client's law department and will keep your firm's presence in mind. Your firm newsletter is useful to a client if it gives practical information about new laws or recent decisions affecting the client's industry.

APPLYING THIS EXPECTATION TO YOUR RESPONSIBILITIES

Flag information to update clients on significant:

Pending legislation.

New case law.

Planning opportunities.

Communicate in terms that are meaningful to the client.

Contribute developments of interest to a group of clients to your firm's client newsletter.

Working with In-house counsel

Although you will find that in-house counsel generally share the expectations held by other clients, some differences exist because they hire outside lawyers to assist them in serving their client — the entire company and its various divisions. You will be able to better anticipate and respond to house counsels' expectations by understanding (1) their role and responsibilities in serving their client, and (2) some common purposes for which they seek outside assistance.

The law department is responsible for handling the company's legal affairs. Its lawyers provide legal advice and assistance to the company to reach its business objectives and to make a reasonable profit for the shareholders. Senior management expects its lawyers to anticipate problems and develop preventive measures, and to solve existing problems. Their advice must reflect an understanding of the business objectives, philosophy, procedures, personnel, and economic problems and opportunities the business and industry face. House counsel are also expected to maximize cost saving techniques.

House counsels' use of outside attorneys varies tremendously from company to company and from matter to matter. A firm may be retained, for example, to handle complex litigation requiring multidiscipline expertise or litigation that arises in a foreign jurisdiction.

CONSIDER:

The corporation was sued in a rural county court of a distant state for many millions of dollars. Its law department handles the company's regulatory work and local litigation. Due to staffing constraints and lack of familiarity with that state's laws and rules of procedural practice, the law department sought out-side counsel to handle the day-to-day strategy and preparation of this case.

The law department attorney assigned to the case engaged as lead counsel a lawyer in that state who had handled a previous matter well for the company and whose law firm possessed appropriate substantive expertise and depth. The inside lawyer asked for references to guide the selection of local counsel in that county. Lead outside counsel recommended a firm of three lawyers with whom he had worked. Local counsel was expected to keep the law department and lead outside counsel abreast of local rules and unwritten practices in the county.

A firm will likely be called upon to assist in high profile matters in which the company faces a substantial risk of adverse publicity. When an issue arises on which the company has substantial financial exposure, senior management, the board of directors, and the shareholders are concerned. The general counsel may engage an outside firm to provide a second opinion for protective purposes. A law department attorney, although possessing the necessary technical expertise or theoretical knowledge, may call upon an outside lawyer to structure a transaction if the department lacks the outside lawyer's practical familiarity with industry-wide or foreign business practices involved in similar transactions. Or, when faced with an unanticipated volume of cases, inside counsel may seek assistance periodically to ease workload constraints. Increases in workload may also prompt house counsel to enlarge the scope of an assignment delegated to outside lawyers. For example, a firm has been engaged to provide technical assistance in a transaction. Shortly after making the assignment, the assistant general counsel who is in charge of that transaction found it essential to devote his attention to a difficult litigation matter. As a result, he requested the outside lawyer to under-take a larger role in the transaction.

In some situations, inside counsel desires ad hoc advice and will use outside lawyers as a sounding board and confidant. They want a devil's advocate who will probe into the basis for their reasoning. For example, during a rapid development of events, house counsel may seek assistance to assess risks, to answer senior management's questions — "What if we do this . . . what if we do that?" — and to formulate workable solutions to limit the company's exposure. Outside lawyers may be an invaluable sounding board because they possess broad-based familiarity with how an administrative agency or a foreign government is dealing with an issue generally throughout the industry. An inside counsel is less likely to know what new position a regulatory agency has begun asserting against its competitors which would also impact its own proposed plans.

Selection of Outside Counsel

Often, outside lawyers are selected on the basis of a recommendation by an attorney in the law department who has used them or by a colleague in another company. Sometimes inside lawyers choose a lawyer who they have observed across the table negotiating on behalf of another party to a transaction or in the courtroom representing an adversary. Referrals are also often made by other law firms. The lead firm on a case may recommend a lawyer with another firm to act as local counsel or to handle a matter outside of its areas of expertise. The criteria that the law department uses to choose an outside lawyer may extend beyond that lawyer's expertise and personality. House counsel often inquire about the depth and qualifications of that lawyer's team members who will assist in the matter.

Note that more than one lawyer in a law department may be responsible for selection of outside counsel to assist in various types of matters. An assistant general counsel who directs regulatory compliance may seek a litigator's assistance; the attorney in charge of financing transactions may periodically retain a securities or tax lawyer. In another company the chief financial officer or treasurer may select an outside tax lawyer to handle a state tax controversy. Therefore, inquiry into the company's managerial structure and reporting channels may be required before a lawyer can successfully cross-sell a partner's services and facilitate appropriate introductions.

Establishment of Engagement Ground Rules

House counsel usually have well defined expectations of outside counsel and of the ground rules that will govern the relationship. During the engagement process they discuss the goal and priorities, and ensure there is a common understanding of each issue. Together with the lead outside lawyer, they allocate responsibilities, develop a staffing plan to achieve optimal allocation of partner and associate roles, and set an initial timetable for major tasks. In most matters, inside counsel is very sensitive to controlling the costs estimated and incurred in reaching the desired result. House counsel often project fees and costs in creating a budget, and discuss billing procedures. Many companies track the billing history on ongoing matters, monitor cumulative costs against the budgeted amounts, and periodically re-evaluate the value of the matter, the exposure of the company, and the cost-effectiveness of outside legal services. Outside counsel who ignore cost projections and budgets will find the law department looking elsewhere for representation.

CONSIDER:

A law department attorney engaged a litigator to handle contractual litigation. Upon reviewing the files, the inside attorney realized that he and the litigator would have to meet with several managers based in the southeast and southwest regions. Because the company’s busiest stretch in its business cycle would begin in two months, it would become increasingly difficult and expensive to bring these employees together. An opportunity arose for assembling the group at head-quarters in three weeks. The inside lawyer contacted outside counsel and scheduled the meeting. At that meeting the litigation partner and an associate covered a few preliminary issues. Six weeks later the litigator requested that inside counsel schedule another meet-ing with these managers. Inside counsel believed that the information needed could have been obtained at the earlier meeting. He was displeased with the lawyer's apparent lack of sensitivity to costs and the man-agers' time. He unhappily anticipated the reaction that the operations department would have when reviewing the charge for the additional meeting against its budget: the vice president of operations may well perceive that the inside lawyer has been managing the case poorly.

What could the outside lawyer have done?

If the lawyer believed the first meeting was premature, he should have communicated his perception and reasoning to the inside counsel. Then, if the meeting was still held, the lawyer could have reiterated that they could work through some issues but that they would need to reconvene later depending on intervening developments.

Teamwork

House counsel expect their staff attorneys and the outside lawyers to work as a team according to the roles and responsibilities agreed upon during the engagement process. Accessibility, regular communication, and coordination are key ingredients for effective team work.

Inside attorneys often need to get in touch with their counterparts quickly. They expect to work with lawyers who are accessible. Suppose, an inside attorney is directed to prepare and submit briefing papers for the company's board of directors by the end of the day. He calls the outside lawyer to find out the status of an analysis the firm lawyers are performing. Or the general counsel has called the partner to obtain an opinion on an aspect of a matter before meeting with the chief executive officer later that morning. If outside lawyers fail to return calls promptly in those situations, inside counsel will quickly become dissatisfied with their ser-vice. Some general counsels maintain a relationship with a liaison partner whom they expect to be accessible for periodic conferences on overall strategy and in emergencies, and to monitor the cost-effectiveness of the firm team's work. See 2.04(h) [Part I, Expectation No. 3: "Determine the Role Each Lawyer Will Fill"] and Appendix C, Client Service Audit: Corporate Counsel's Evaluation.

Regular communication and coordination among the lawyers is necessary to carry out their respective responsibilities. For example, outside lawyers need assistance to obtain and assess information relating to the company's policies, procedures, personnel, and factual details. Suppose an associate is assigned to prepare a company employee for a deposition. By conferring with the in-house attorney first, the associate may be better able to anticipate potential trouble spots and to effectively prepare the witness.

To carry out their role of managing the outside legal work, corporate law department attorneys generally expect to be involved in assessing alternatives and creating solutions. In addition, they are familiar with their company's goals, business perspective, priorities, approach to weighing risks, and expectations. Communication is key in meeting inside counsel's expectations, in formulating a strategy and tactics that remain consistent with the company's related plans and activities, and in developing workable solutions. Suppose, for example, the corporation decides to improve the tone of its relationship with the adversary during the pendency of litigation due to a new business opportunity. The approach to the litigation will have to be adjusted accordingly.

You will probably experience early client contact with lawyers in the law department. As a member of the team, become attuned to the corporation's culture and operational style. Each corporate client is different and has distinct needs, goals, and management styles. Understand the inside lawyer's roles and responsibilities to the client and specific expectations held by the supervising attorney and client in this matter.

Your role and scope of work will vary with the type of matter and with the nature of the relationship between your firm and the company's general counsel — frequent service, a one-time assignment, or assistance in specialized matters. Whatever your specific role, generally your overall objective will be to assist those lawyers to manage and resolve the matter or legal problem. In carrying out your responsibilities, maintain a comfortable working relationship by adapting the expectations discussed in this Part I to the context of your teamwork with inside counsel.

APPLYING THIS EXPECTATION TO YOUR RESPONSIBILITIES

Expectations of Clients in the context of an engagement by inside counsel, determine:

Supervising attorney's role.

Your role.

Role of your counterpart in the law department.

Ask Yourself: "Am I helping inside counsel manage and resolve this matter or legal problem?"