Executive Summary
Forming a law firm is a big deal. It creates client obligations and determines how firm members deal with each other. It also has to be run like a business. Minimum standards apply. Some small firms call themselves a “firm,” but they are run like unrelated solo practices. These are “silo firms,” and they are a bad idea.
Do It the Right Way
If you’re going to create a law firm, you should follow certain minimum standards. Best business practices will ensure solid management, oversight and accountability. Protect yourself and your clients by clearly defining – and communicating to all interested parties – how your firm is organized.
Alta Pro Practice Pointers
- Act like a firm. If you’re going to hold yourself out as a law firm, act like it. Have a formal partnership agreement and review it periodically. Put your firm’s name on your website and front door. Have an Office Policy Manual that applies to everyone. Consult on matters of common interest. Be a team, not a collection of individual players.
- Implement procedures for client relations. Use standardized intake forms to collect basic information about new clients and matters. Capture information necessary for conflict checks and case management. Other important procedures: file opening letters, client communication guidelines, file closing letters and file retention guidelines. Find more pointers in “Getting and Keeping Great Clients.”
- Invest in IT. Everybody in the office must be trained. There’s lots of off-the-shelf client management software to choose from. Pick a program that suits your firm’s needs. When used wisely, technology can help you run a more productive and profitable office by managing workflow, avoiding conflicts, simplifying billing and tracking key deadlines.
- Provide oversight of open cases. This can be hard for lawyers who value their independence. But not knowing about a problem in one lawyer’s case could mean liability for all members of the firm. The solution: develop a workable procedure for monitoring and auditing client matters.
- Have a formal work sharing and support structure. How does the firm handle client and file management concerns? Who covers time conflicts—or vacations? Does the firm have a crisis management plan in case of a health issue or death of a member of the firm? Are these procedures in writing? Does everybody follow them?
- Manage resources and employees. Have an Office Policy Manual. Make sure everyone reads it and follows it. Topics to cover: personnel matters, case handling, conflicts of interest, and protection of client information and property. Find more pointers in “Best Practices for Your Firm.”
- Avoid the silo trap. Some firms are little more than individual solo practices that share expenses. These are silo firms, and they are malpractice traps. There’s no centralized oversight or management. The lawyers don’t communicate regularly and don’t support each other meaningfully. They have little incentive to invest in pooled IT or personnel. They don’t share their knowledge and expertise – but they do share liability for potential malpractice. Lawyers may not know what’s going on with their partners and their cases. This increases everyone’s malpractice exposure. There is also a greater risk of conflicts of interest, administrative errors and overall inefficiency. Clients may think this is a traditional firm. As a result, you might find yourself being blamed – or sued – for the mistakes of a lawyer in the next silo.
The Bottom Line: Run your firm like your professional future depends on it – because it does.
What’s Next?
Have a question about your firm’s structure and organization? Ask the Risk Pro!
Looking for tips on office sharing with other lawyers? Click here!
Heads up!
This information is intended for informative purposes for members of Alta Pro Lawyers Risk Purchasing Group. It is not intended as legal advice. Lawyers should always refer to local and state rules and statutes for applicable standards and rules. These guidelines are designed to help lawyers avoid professional liability claims and are not intended for any other purpose. No legal or fiduciary relationship is intended to be created by receipt of this material.
