September 13, 2006 Host: Jen Woods Guest: Sandy Pfau Englund
Sandy Pfau Englund, founder of Pfau Englund Nonprofit Law, P.C., discusses why nonprofit organizations seek legal counsel. Duration: 00:07:13
Jen: Hi, this is Jen Woods from LawCrossing. Today we're speaking with Sandy Pfau Englund, founder of the Pfau Englund nonprofit law firm.
Jen: Why do nonprofit organizations seek legal counsel, and what types of issues do they frequently need help with?
Englund: Well, Jen, nonprofit groups come to law firms for a variety of reasons. The main reasons they come to us are either if it's a new organization that wants to get started, wants to incorporate as a nonprofit corporation, and primarily also get their federal taxes status so that they can receive tax exempt donations and also don't have to pay taxes on any net income that the nonprofit might have. So, that's the start up portion of our practice. And then, there's a lot of nonprofit organizations that are out there, primarily the larger ones that have a paid staff and an ongoing program, that need a wide variety of legal help. A great deal of that is contracts. They have—nonprofit groups often have meetings, conferences, educational workshops, and to hold those they need to have a contact with a hotel or another facility to have the meeting. They may need to have contracts with speakers. They may have contracts so they can have their website like everyone else. So there's a lot of contacts involved for ongoing nonprofits. Those that have a staff of any size have the regular employment issues that any employer may have, between employment contracts or employee handbooks, a wide variety of things that way. So, for our practice and what we see with nonprofits, it's either the startup end of things or the ongoing legal work. Oh, and I thought of one more thing, and then there's also nonprofits that deal with a lot of fundraising issues. States, most of them, have fundraising registration, and fundraising requirements, and forms that have to be filled out, and nonprofits come to us with what they can and can't do in respect to fundraising.
Jen: Can you give a brief overview of your firm in particular?
Englund: Our firm does, really, those things. We have a pretty large practice with nonprofit startups. I think we have a fairly big presence on the Internet and so a lot of new nonprofits come to us and we assist them. We specialize in another segment of that which is parent-teacher organizations, parent booster groups, athletic booster groups. Those groups have traditionally been run by volunteers. And volunteers that turnover as their children get older and, you know, enter these activities and leave these activities. And so we have set up two websites, ptolaw.com and parentbooster.org, which both are catered to that particular part of the market. And then I do also have quite a few larger ongoing nonprofits that come to me with all those contractual issues, and employment issues, and fundraising issues.
Jen: What are some of the most common reasons that nonprofits get sued?
Englund: Well, hopefully nonprofits don't get sued that much. In my experience, my clients rarely, if ever, have gotten sued actually. But some of the research I've looked into and some of the big issues are; if their board of directors doesn't carry out their responsibilities - they don't make sure that they have an annual budget every year, and abide by that annual budget and actually participate in meetings. And then, I would say, the other big issue—and this is the larger nonprofits that have employees, because it's common for any employer, whether they're nonprofit or for profit, for that matter—if someone loses their job, that hurts them financially; and they're more likely to maybe sue someone and go to court. So, it's really not so different for a nonprofit that has employees than a "for profit." For the most part, I don't see nonprofits getting sued a lot. But it is becoming more prevalent, and for that reason I really advise the nonprofits that I work with, to the extent that they can afford, to have insurance. To have insurance because my clients, those that have been either named as a third party in a lawsuit or whatever, most of the time they get out of those lawsuits. But the cost just to get an attorney to represent you and get you out of being a named party in a lawsuit can be very expensive. So while nonprofits aren't getting sued a lot, I do recommend that, there is insurance out there; and it's a good idea to have it.
Jen: What advice would you give to someone who has aspirations to become a lawyer for nonprofits?
Englund: I would tell them if they really want to do it they should go for it. I didn't know anything about this area of law until my third year in law school, and there was an elective class that I could take in nonprofits. And to me it just all fell together because I've always—I had parents who were teachers, one who worked for a college, who were always very active volunteers in the community, and it just fell together for me. And I must say I love what I do. The people that I work with, most nonprofits, are out there trying to make our society better in one way or another or trying to make, if they're a trade association, their particular industry a better industry, regulating things for the citizens. So, they're really for the most part—you hear on the news once in a while when things go bad, but that's—the majority of the people who run nonprofit groups have very strong ethics and are really out there trying to improve the world. And they're a wonderful group to work with. And the other thing is, for lawyers, there are many different areas of the law. I think sometimes if people aren't lawyers they aren't aware of how many laws are out there and how specialized lawyers really are. But when you work with nonprofits, there aren't many emergencies. And that's a nice thing, as far as a profession, if you're looking at a profession. But that doesn't mean I'm not stressed and I don't have things to do for my clients and I don't have exceedingly busy days. And, on the other hand, it's the type of practice where you can, at least in my case, I've been able to build a nationwide practice and also raise three children, and now home school my children—and be able to do all of that at one time and work with really wonderful people. So, I think that, as I tell my children, you should do what you want to do. And if you have a passion for nonprofits, and a passion for helping them, by all means. I think it's still an area, a growing area, and people should go for it. Go do it.
Jen: Well, thank you, Sandy, for speaking with me. And thanks for listening.
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