When considering starting your own law firm, one often overlooked source of business for your fledgling business is local counsel work.
When I began my career as an attorney at a medium sized firm, I had an idea of what I would be working on. For instance, areas such as corporate law, family law, criminal law, estate law, real estate law, are all examples of practices areas that I, like all lawyers, am familiar with because those courses are taught in probably every law school in the United States. So, if you join a law firm in the private practice arena, you will probably work as a lawyer in one or more of these areas.
For example, the typical way to practice law is to have a client ask you to help them with their legal problem. A person or entity will come to you and hire you to help them with their business, family, or personal legal dilemma. That is the most common way to work as a lawyer.
However, one surprise that many lawyers find when they start practicing out of law school is that other lawyers and firms often hire attorneys outside their firm to be their lawyer for a local hearing. This concept is called local counsel.
There are two standard forms of local counsel work:
(1) a firm in the jurisdiction you work in, but which is a long ways away (like in a different city) hires you; or
(2) a firm outside of your jurisdiction and typically in another state hires you.
In these two situations, attorneys and/or law firms will hire out a lawyer to handle hearings in the courthouse or county where the original firm has filed its case. Hiring and outside attorney enables the hiring law firm to have an attorney present in a court-house that is far-far away from the hiring firm’s office. It would be much too expensive to have a $300.00-an-hour attorney drive from a far away city to attend a minor foreclosure hearing. So, the law firm that originated the lawsuit will often hire an attorney at a lower dollar amount to handle a simple hearing.
Examples of legal areas in which local counsel work is needed are: foreclosures, bankruptcy, and debt collection. Often the hired attorney will appear at a minor hearing, such as a status conference, and file an attorney appearance with the court. The attorney will inform the court that he or she has been hired only for the purpose of the local counsel work. A judge will often understand that the law firm who hired the local attorney will handle the actual procedural filing. However, the local counsel attorney will handle the minor matter before him or her. One thing to keep in mind is that the hired lawyer still owes a duty to both the court and his client to be diligent and prepared when he or she accepts the case – no matter how minor it is.
Why is local counsel work important for starting your own firm? In the foremost, it is usually relatively simple and it is a very effective way to generate cash flow for your firm. Without cash flow, your law firm will die.
Another great thing about local counsel work is that it helps the courts function efficiently. If an attorney can show up at minor hearing and guide the legal process along, the court can worry more about other, more important, cases on its docket.
In sum, local counsel work is an often unknown and overlooked aspect of starting and building a law practice. Attorneys who have been practicing for any amount of time often know about local counsel work. However, a person coming out of law school likely has never heard of it. If a person decides to start their own firm out of law school, they will not want to miss this great source of revenue-generating work.
Furthermore, another reason to do local counsel work is that lawyers tend not to stiff other lawyers. In other words, when you are hired, you know you are going to get paid. That may sound simple, but when you are staring out and trying to survive, getting paid for the work you do is of the utmost importance. Heck, it may be the only important thing to know when you are starting your own firm.
When considering starting a law firm, and whether your niche area is family law, criminal law, corporate law, or some other area of law, you need to remember local counsel work and focus some of your firm marketing towards this area. It is not always the most lucrative work, but, if you can get it, it is steady, it generates immediate cash flow, and it get your new law firm humming.