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Ten steps to take before hiring a lawyer Add to ...

Whether you're incorporating your business, figuring out basic zoning compliance or seeking advice on trademark or copyright, lawyers can be invaluable. But for the cash-strapped entrepreneur, finding a lawyer can be an intimidating process. Here are ten tips to help you on your search:

1. Identify the problem. This step may be the hardest, but it can save you money. You may have a legal problem if your rights or interests require protection or enforcement, or if laws, regulations or another party’s rights or interests are being defended or enforced against you. Lawyers appreciate and can better help you if you are aware of the legal problem that you face. If your problem is not legal in nature, you or another professional may be able to solve the problem at a significantly lower cost.

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2. Set a realistic budget. Setting a realistic budget for legal fees requires (i) determining what you can afford to pay for legal services and (ii) estimating what lawyers will accept as payment for their legal services. Hourly fees for lawyers can range from $100 per hour all the way up to $1,000 per hour depending on their location and their area of practice. Some lawyers may also offer flat fee arrangements for certain tasks. When setting your budget, keep in mind that, in general, most lawyers will not work for free and experts in an area of law will be more expensive.

3. Research candidates online. Before meeting with lawyer candidates, go online to find out more about them. You should review their website and their LinkedIn profile. You should also Google them to see what third parties have said about their experience and credentials. Finally, you should go to the lawyer directory on the website of the law society for your province and perform a search on your lawyer candidates. On the lawyers’ profiles on the lawyer directory, you will discover whether they are qualified to practice law in your province, whether they are or have been suspended from the practice of law and whether they have been subject to any disciplinary actions.

4. Trust your instincts. When you finally meet with your lawyer candidates, determine your comfort level with them and see if they make an effort to understand you and your business. Even the most highly recommended lawyer may not guarantee a successful relationship with you and your business.

5. Check your emotions at the door. Running a business can be a stressful affair. While passion and emotions are useful in driving your business forward, it is important to keep them in check when presenting your legal problems to lawyers. Lawyers may appreciate your passion for your business, but what they really need is a rational explanations of your goals so that they can determine the appropriate steps to help you.

6. Sell yourself and your business. Explain why you would be a good client and why you have the potential to provide additional business to them in the future. In addition to being paid for the initial task, lawyers want to know that they can count on you for future business and, to a certain extent, are interested in helping you build a successful and profitable business.

7. Ask for references. Although it is skewed positively to the lawyers’ benefit, a lawyer’s references’ can give you insight into the his or her communication style, billing practices, quality of legal work, etc. Keep in mind, however, that it may take time for some lawyers to arrange a reference because they must ask their clients’ permission before they can provide you with their contact information.

8. Negotiate a better arrangement. Ask about a flat fee arrangement and how it might be structured for your specific legal problem. If it is a billable-hour arrangement, ask for a discount of 10 to 20 per cent if you think you have successfully sold them on you and your business and/or if you can demonstrate financial constraints. Also inquire about a maximum dollar amount at which your legal fees may be capped.

9. Get team buy-in. As a small business, you and your partners are actively involved in all aspects of your business. Providing legal instructions and information relevant to your business to your lawyer is no exception. Before choosing a lawyer, run your thoughts by your team and get their feedback. Your team needs to have confidence in the lawyer in order for him or her to assist in effectively resolving your legal problem.

10. Review agreed-upon terms carefully. All lawyers worth retaining will document agreed upon terms in a retainer letter. The retainer letter will outline the legal tasks on which the lawyer will work and specify the payment arrangement. It is important that you thoroughly review the retainer letter and ask any questions that you may have about the terms since it will govern your relationship. If there are any ambiguities or inaccuracies with which you are uncomfortable, it is best to resolve the uncertain or inaccuracy before the lawyer begins his or her work on your legal problem

Jeff Fung is Founder & CEO of MyLawBid, an online Canadian lawyer referral service.

Follow us on Twitter: @GlobeSmallBiz

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