Posted Jan 18, 2012 2:48 PM CST
By Roya Behnia
Three years ago, I was part of a law firm panel discussion on effective business development. We covered the usual topics, including alternative fee arrangements, budgeting, marketing, etc. I emphasized the importance of having lawyers who made my job as an inside counsel easier. I spoke of outside counsel who anticipated needs I didn’t know I had or didn’t have the resources to address.
Imagine my surprise when one of the senior partners asked the panel, “How do I know what will make your job easier?”
When my turn came, I said, “It’s simple. Ask me.”
Open communication underlies all the values of the agile legal model I previously wrote about:
1) Continual collaboration with clients.
2) A commitment to flexibility and rapidity.
3) Direct communication rather than complex documentation. 4) Continual focus on client goals.
5) Realistically weighing risk.
6) A strong bias toward simplicity.
I described how lawyers could live these values, including by giving immaterial contracts or matters “good enough” review or by discarding long memos in favor of face-to-face communication with clients. After some objected that agile could expose lawyers to malpractice claims by disgruntled clients who want someone to blame, I described the need to better understand and accommodate your client’s risk tolerances though continual collaboration and communication.
Whose responsibility is it to maintain open channels of communication? One of the commenters on my last post thinks it is the client:
Sometimes, the reason the lawyer and the client have vastly different expectations about risk is that the client hasn’t done a good job of communicating its risk preferences to the lawyer. Clients can (and do) have vastly different attitudes toward risk. Anyone who doesn’t do a lot of insurance work and then stumbles in to a case where the insurance company is paying the bills has probably learned a painful lesson about this. That doesn’t mean that Client A has the right attitude about risk or that Client B has the wrong attitude about risk, but it may mean that “perfection thinking” is appropriate for Client A but not for Client B. How do I know whether the clients want “perfection thinking?” The clients have to tell me. For a client for whom I have 30 or 40 files open at a time and try a case or two or three a year, I probably know what the risk preference is. In the best case, I can even point toward attributes of a particular case that might make the client more or less risk-averse than where that client usually is.
This commenter is spot on about differences in risk tolerances among clients. But when expectations about risk are different, why is it because “the client hasn’t done a good job of communicating its risk preferences to the lawyer?” Where is the outside lawyer in this exchange?
The disconnect about how and when lawyers should communicate is the principal cause of client dissatisfaction and legal malpractice claims. The communication expected under an agile approach actually may protect against the risk that clients will blame you if things go wrong.
Don’t believe me? Consider the a 2009 piece published by the ABA’s Law Practice Management Section putting malpractice claims into context:
Insurance industry statistics for the United States and Canada show that errors in applying the law serve as the basis for malpractice suits in just over 10 percent of cases….So what do lawyers do that accounts for the other 90 percent of malpractice suits? There are several explanations, but the bottom line is they fail to communicate. The biggest group of claims comes from clients who believe their lawyers did not communicate with them enough or at all. And, who decides whether there has been enough communication? In one word, it’s the client.
The fact that failures in communication account for 90 percent of legal malpractice claims should give outside counsel pause about who should ensure that dialogue with clients remains open. Putting aside fault, isn’t the client’s view of the value of the services their lawyers deliver ultimately what matters?
Even in our current economic climate, most commercial clients don’t want to sue their lawyers if things go wrong. (In reality, most malpractice claims are against plaintiff’s personal injury, trusts and estates, real estate, and family law practitioners, according to the ABA Journal’s 2009 article, “Practice Pitfalls.” What commercial clients want is to have their business needs understood by their lawyers. The professional literature is full of examples, but the following statement noted by writer Janet Ellen Raasch at the Rocky Mountain Chapter of the Legal Marketing Association synthesizes the prevailing view:
What do general counsel want from outside counsel? “It is very simple,” said [Rebecca] Askew [General Counsel of Circuit Media]. “Legal expertise is the bare minimum. We want outside counsel who also respect our budgets, deadlines and communication styles. We want outside counsel who know our businesses. We want outside counsel, in short, who define their success as our success.”
What should you do to get the lines of communication fully open?
Off the clock, pick up the phone and check in even if you have nothing new to report on your matter. Offer to spend a few days free of charge shadowing your client so that you can understand his or her day better. Ask for feedback on your performance and don’t get defensive. Ask how your client would prefer to communicate. Offer to prepare executive presentation materials on your matters so that your client doesn’t have to. Lend your client a sympathetic ear when he or she is frustrated with business colleagues, because that will happen. If you are in the same city, go to lunch. Develop a relationship. Listen. You will be ready for agile in no time.
Roya Behnia was senior vice president, general counsel and secretary of Rewards Network Inc. (NASDAQ: DINE) until December 2010 after completing the sale of the business. She led the legal, human resources, and compliance functions and served on the company’s executive management committee where she was centrally involved in developing and implementing business strategy for the company. She has been an in-house lawyer since December 1998, working with Brunswick Corporation and SPX Corporation. Before that, she was a partner at Kirkland & Ellis.
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