Keep Outside Counsel in the Loop

by Ed Poll

Whether the relationship between law firms and corporate counsel is new or long-standing, every new matter involves the opportunity to establish a dialogue that can support a collaborative relationship.

In-house counsel should make clear all expectations and objectives to outside counsel at the outset. Promoting quality communication between business client and firm depends on detailed and clear communication to create a mutually beneficial relationship that is cost-effective for the client and yet profitable for the firm — particularly given that priorities between corporate clients and lawyers often diverge on controlling costs.

In-house counsel can further that understanding by bringing to the table a formal checklist that defines exactly what is expected of their outside firms.

The list should cover both qualitative issues and procedural details in such a way that outside counsel clearly knows how the client defines fundamental satisfaction. Only then can the relationship be successful.

Such a checklist could cover these items:

• Engagement goal

  Define positive and cost-effective guidelines that will build mutual confidence by setting forth a workable and an agreed-upon set of principles.

• Retention

  State that the matter should be founded on a formal engagement agreement that can only be amended by written agreement of both parties.

• Conflict of interest

  After notice of possible retention in each matter, make sure outside counsel checks immediately and notifies promptly about any potential or actual conflict.

• Communication

  Specify that all documents, from correspondence to pleadings, are sent to the client for review and that the client is consulted before consultants, expert witnesses or additional counsel are engaged.

• Budget

  Make certain outside counsel prepares and periodically reviews a budget that evaluates risks, assumptions, options for handling the matter, likely timing and sequence of steps, and a projected cost for each phase.

• Staffing

  At the start of each matter, ask outside counsel to identify the lawyers assigned and their billing rates, and specify there are no startup charges for educating new team members.

• Confidentiality

  Require that all work product prepared for each engagement will be client property and will not be shared with other clients of outside counsel without consent — and, of course, that all files and documents are subject to the fullest attorney-client privilege.

• Fees

  Stipulate all fees, ancillary charges, alternative billing arrangements, trust account provisions and retainer fees, as well as all payment rates and terms, up front.

It is essential that the corporate client knows what its outside lawyer is doing and that the client approves of the tactics to achieve the client's goal.

By making clear all expectations and objectives right at the start of any engagement or relationship, in-house counsel give their outside lawyers as much information as possible about the goals, anticipated strategies, desired outcomes and anticipated operating guidelines for the upcoming engagement.

Making clear the client's objectives and setting forth how to meet them are essential to securing the value that the corporate world wants from outside counsel.

© Copyright 2011. Edward Poll. All rights reserved. Reprinted with permission from Edward Poll.

About The Author

Ed Poll principal of LawBiz Management Company, is a nationally recognized coach, law firm management consultant, and author who has coached and consulted with lawyers and law firms in strategic planning, profitability analysis, and practice development. Mr. Poll has practiced law on all sides of the table for 25 years-- as a corporate general counsel, government prosecutor, sole practitioner, partner, and law firm chief operating officer and been a consultant to small and large law firms for 20 years.

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