Assigning Power of Attorney (PoA) With Confidence

Incapacity planning, ensuring that there’s a strategy in place if you ever become incapable of managing your affairs, is important.

We all know that. Yet, it’s uncomfortable to think about and therefore easy to put off doing.

A key part of incapacity planning is assigning power of attorney (a legal document giving someone else the right to act on your behalf), but it’s also the biggest hurdle. Giving extra thought to who you choose, and what powers they’ll be granted, can give you the peace of mind to complete your plan with confidence.

Choosing your lawyer

Choosing someone you trust to assign power of attorney is essential. Acting as your attorney involves significant duties and obligations. Your attorney’s overarching duty is to act with honesty, integrity and in good faith for your benefit if you become incapable.

The law lays out specific obligations for the person chosen to hold your power of attorney. Among other things, they will:

  • explain their powers and duties to the incapable person
  • encourage the incapable person, to the best of their abilities, to participate in decisions concerning their property
  • foster regular personal contact between the incapable person and supportive family members and friends, and
  • keep account of all transactions involving the grantor’s property.

The attorney or attorneys you choose to act on your behalf should know these rules, and be aware of other rules set out in the act as well.

For instance, they’re expected to ensure you have a will and, if so, know its provisions. The main reason for this is that your attorney must not sell or transfer property that’s subject to a specific gift in the will, unless necessary.

The act also contains explicit instructions regarding both required and optional expenditures. Examples of the latter include charitable gifts where an incapable person made similar expenditures when capable and so long as sufficient assets are available. Your attorney should also be familiar with rules covering how or when he or she can resign, what compensation they may be entitled to and the standard of care expected of them.

Safeguarding your estate

You can also build a second opinion directly into your power of attorney documents by appointing more than one person. If you name two or more people, they’ll need to act unanimously unless the document states otherwise.

A joint appointment provides a level of protection in that any appointed attorneys must agree on all actions, while a “joint and several” appointment grants flexibility, allowing any one attorney to conduct business independently.

Many people choose to appoint the same people or trust companies to be both their power of attorneys and their executors. Although you don’t need to do so, the same list of key traits – expertise, availability, accountability and trustworthiness – apply to both roles.

It’s also possible to limit the powers granted to your attorney. If you’d like your attorney to act only for a specified time period (maybe a vacation or hospital stay) or in respect of a specific transaction (the closing of a real estate deal), a limited or specific power of attorney is worth considering.

In the case of a general continuing power of attorney, many people want the document to be used only if and when they become incapable of managing their affairs themselves.

Although the document is effective when signed, it is possible to include provisions in the document itself that defers it to a future date or the occurrence of a specified condition (for example, the grantor has a stroke). These are sometimes referred to as “springing” powers of attorney.

Whichever way you prepare your power of attorney documents, careful consideration of who you choose as well as availing yourself of available safeguards will help ensure your confidence in your incapacity plan.

Common Mistakes to Avoid

  1. Making a quick decision: Many people name their PoAs without thinking about their choice’s financial capability, much less their ability to get along with other family members.
  2. Assuming family is always the best choice: It’s far more important to choose someone who truly has your client’s best interests at heart.
  3. Waiting too long: If there’s already a question of diminishing capacity, it’s likely too late to make a power of attorney ironclad.
  4. Not reviewing it: Changing life circumstances and new provincial legislation can make an old PoA invalid.

Plan for Incapacity

Your estate plan doesn’t end with an up-to-date will. It should also anticipate possible future incapacity, which usually means preparing powers of attorney for both property and personal care.

Power of attorney, a legal document that gives someone else the right to act on your behalf, has two main types: one for management of property, another for personal care.

Will and estate planners generally advise preparing both types of powers of attorney. While they are often prepared at the same time as your will, they can be created at any time.

Personal care

With a power of attorney for personal care, you can authorize someone to make decisions concerning your personal care in the event that you become incapable of making them yourself.

You can give power of attorney for personal care if you’re at least 16 years old, have “the ability to understand whether the proposed attorney has a genuine concern” for your welfare, and can appreciate that the attorney may need to make decisions.

Personal care includes decisions concerning health care, nutrition, shelter, clothing, hygiene and safety.

Property

A continuing power of attorney for property authorizes someone to do anything regarding your property that you could do if capable, except make a will.

The law says you’re capable of giving a power of attorney for property if you’re at least 18 years of age, know what kind of property you have, along with its rough value, and are aware of any obligations owed to your dependants.

The term “continuing” (sometimes called “enduring”) refers to a power of attorney that may be exercised during the grantor’s subsequent incapacity to manage property. Ensure the document stipulates that you want the power of attorney to be used only if you become incapable.

What you need to know

A continuing power of attorney for property is a powerful document. Unless otherwise stated in the document, it’s effective when signed, granting considerable power.

In fact, the act explicitly requires you to acknowledge this authority can be misused. And, as part of the capacity test for granting a continuing power of attorney, you must also acknowledge the property you own may decline in value if not properly managed.

A financial institution, land titles office or other third party presented with a continuing power of attorney for property with the restriction “effective only in the event of the grantor’s incapacity” will want evidence of the incapacity.

That evidence could be hard to get. One solution is to set out terms of use in a separate document and have all original copies of the power of attorney held by a trusted third party. You could, for example, direct that document be released only if:

  • You tell the attorney you want him or her to start acting;
  • You are legally declared incapable of managing your property;
  • One or more doctors advise that you’d benefit from assistance in managing your affairs; or
  • Certain family members advise the attorney should begin acting.

No direction could be costly

If you fail to prepare power of attorney documents, it may take an application to court before someone can be appointed to make decisions for you. That can leave you scrambling when you’re in no physical shape do so. Having a will doesn’t help because an executor is only authorized to act after you die.

On top of that, court processes can be both costly and time-consuming. Depending on the circumstances, the Public Guardian and Trustee may have to get involved.

You also lose the opportunity to appoint people or companies of your choosing and aren’t able to establish parameters regarding the actions of your substitute decision makers.

Making a Professional Law Firm Website

Having a website is now a necessity not only for businesses but even for legal service providers like a law firm. A professional looking website is one of the most effective ways of generating leads for your company or law firm. Almost everyone has access to the internet so whenever someone needs to look for something, the first thing they’ll do is to look for it online. Having a website is a suitable way to be seen by prospective clients. The internet has greatly changed the way people get the information they need. Surely there’s still some that rely on the word of mouth, but the internet can give a bigger advantage in reaching more people, even to those who haven’t heard about a law firm before.

However, having just a website is not enough, what you need is an attractive and professional looking law firm website is more likely to impress prospective clients. Otherwise, the website’s visitors will immediately leave your website after a few seconds. People are very particular with the design of a website, and your website reflects the qualities of your firm.

People searching for a law firm website want to know that your firm is reliable and can handle their legal concerns. The website of your firm should be able to convey this message to their visitors. A professional web designer can be hired so they can layout and make the website look professional. Just by changing how your website looks can greatly change how people think about your firm.

Aside from just improving the overall appearance of your firm website, it should also be informative. People want to know more about your firm, your track record and experience. The website must also highlight your achievements and expertise in various fields of law. Giving your prospective clients their needed information can help build trust and can make them comfortable about your firm.

Law firms that have area of specialization are what people look for, especially for individuals who are facing sensitive legal situations regarding their family or criminal case. Your firm’s website should be as specific and informative as possible. The information on your website should be easy to understand but at the same time comprehensive enough to cover all the details about legal services. It is best to avoid using any legal jargon and keep the language simple. The main goal is to build trust and establish credibility among your prospective clients through your website.

Auto Accidents: Step by Step, by the Right Attorney

I have written this article with the “average” case in mind, as that imaginary “average” case is the one which occurs most often. I believe that there are absolutely “rights” and “wrongs” in the handling of a personal injury claim. At the conclusion of this report, if you have questions, I will tell you how we can connect to try to get them answered.

Problem Presented:

You have just been involved in an automobile collision which was not your fault. Your car is all banged up; you are hurt; you are probably worried about many of the consequences this collision has now created, and as the expression goes: “this just wasn’t a good time for this kind of thing”. There are 101 things racing through your mind. Certainly, the last thing you need is to worry about finding a good attorney to handle matters for you. Hopefully this article will give you a leg up on making that search a bit easier, by allowing you to know what to look for, and by allowing you to know what questions to ask.

Plan of action to solve the problem: find an attorney to help!

Finding an attorney is easy. Finding the right attorney might be a little tougher. First, understand that there is nothing immediately critical about hiring an attorney. I recommend, however, that you do so within 2 – 3 days of the collision. In this fashion you can avoid being hassled by insurance adjusters, and an intelligent course of action for you and your case can be formulated. Back to finding that attorney. If you have a good case, there are hundreds of attorneys who will be thrilled to work for you. I would be less than honest if I didn’t admit that legal fees for “personal injury” cases can be very handsome. Such fees for the right attorney however, are well worth it. Read on, and you’ll see why.

You should be able to recognize a sincere appreciative attitude on the part of the attorney you select. Again, there are hundreds of attorneys who’d be very happy to have you as a client. If the attorney you select isn’t one of them, find one who is. That attorney will work very hard for you. Keep reading, and I’ll help you learn how to pick the right attorney.

The Initial Stages and the first contact.

Your car is in need of repair, you are in need of medical treatment, and your ability to go to work at this point is in doubt, both because you now lack transportation, and because you don’t feel physically able to do so. Insurance adjusters are calling. What should you do? A good attorney can tell you. A good attorney will also find out many important things, such as: did police investigate? was the other party given a ticket? who is the other guy? is there insurance? is there enough insurance? Again, a good attorney will advise you about what to do, and find out the answers to all of these questions. You need to concentrate on getting better. Investigating these matters and spending hours on the telephone are the last things on the doctor’s prescription pad for you.

Good attorneys can be found in many places. If you don’t know anyone who has used an attorney for a personal injury matter, there is probably a local bar association referral service. If there isn’t, or if they’re not open and you want contact now, internet search engines will offer the names and website addresses of all types of attorneys, from single practice attorneys up to large firms. I encourage a good look at the lawyer’s or the law firm’s website: read about their experience and see if the website “speaks to you.” I do not recommend telephone book ads to find a lawyer, nor do I recommend television ads, because really, they don’t tell you much. Once you select an attorney or two or three to interview, don’t jump without asking a lot of questions, no matter where the attorney’s name came from.

The first call to the attorney’s office.

You select an attorney and you want to call him or her. Pay attention to several things: Is the number you are calling advertised as 24 Hours? If so, who answers the call? Is it a tape? Is it the staff? Is it the attorney? Any may be acceptable, but clearly, you should be looking to talk to the attorney within a reasonable time if that first call doesn’t get you connected to him or her. Next, should you call “off-hours”, or wait until business hours Monday through Friday, 9 – 5? My feeling is that an attorney who practices personal injury law must recognize that potential clients are calling, often very traumatized, often very confused, and often in need of some good solid advice. Accordingly, that attorney should be available whenever the potential client calls. So you call, and you are generally pleased. The attorney sounded okay, and invites you to his or her office for an appointment. Before you go in, ask some questions:

How long has the attorney been in practice? You want someone with experience.

What percentage of the attorney’s caseload involves handling personal injury matters? It should be over 50%.

Does the attorney regularly go to court and try cases involving personal injury matters? Yes is the only acceptable answer.

Is the attorney accessible? Get a commitment that you’ll be able to speak to the attorney, if you want to, within a reasonable time, every time you want to. Promise to respect the attorney’s off-hours privacy, but ask if the attorney will give you a home telephone number for emergencies.

Will you be kept informed of all significant developments? This means that you’ll routinely get copies of important correspondence, and that you will be consulted before decisions beyond the mere routine occurs.

How money is handled? Don’t be shy about asking about this!! This is the primary reason you are hiring an attorney. Think about it… The mechanic is going to fix your car. The doctor will get you back to good health… You’ll certainly ask them questions… The attorney is the person who will help get you the money from the other guy’s insurance company to pay for all of this!

The first meeting with the attorney.

You’re satisfied and you agree to meet with the attorney you’ve called. At this meeting you should meet the attorney, talk with him or her for as long as you want, and the entire process should be explained to you. This includes explaining all of the possible insurance benefits available to you from all sources, including your own insurance company, and how and when such benefits are to be expected. It also means explaining, at least in summary fashion, the applicable law which governs your case. Different states have different laws which control “liability” issues and ultimately affect compensation. Ask your attorney if your state follows no-fault, comparative negligence, or contributory negligence principles.

At this first meeting, which is really the beginning of your case, your attorney CANNOT predict how much money you’re going to get for your injuries. Nobody knows, at the early stages, how badly you are hurt, how much medical care you’re going to need, how much time you might miss from work, or even the potential legal theories which might be available. Can you predict the final score of a baseball game in the first inning? IT IS RIDICULOUS FOR AN ATTORNEY TO ATTEMPT TO ESTIMATE HOW MUCH YOU’RE GOING TO GET AT THE BEGINNING OF THE CASE.

At the initial meeting a paralegal or other staff member may take “administrative” information from you. The attorney should explain the legal contract, or fee agreement, with you. Attorney’s fees in this type of case are almost universally “contingent fees”, which means the attorney only gets paid when the case is settled; that is, the fee is “contingent” upon resolution. Usually attorneys charge one-third of the recovery, and usually contracts of this sort detail a higher fee, perhaps 40 – 50%, if the case goes to trial. This is fair; because going to trial is a lot more work for the attorney, and involves the attorney taking on a lot more risk. Recognize that every “contingent fee” case an attorney takes on is a case where the attorney is working for free, and at great risk of getting nothing, until (and unless) the case resolves.

How the first meeting should end.

Your initial meeting with your attorney should conclude with you receiving a copy of the fee agreement, and with a very concrete list of things which should be set to happen.

1. You should have a list of things the attorney needs, such as a copy of your insurance policy, pay stubs, tax returns, photographs, etc.

2. Telephone calls should be made promptly for the resolution of the damage to your car. The two most typical scenarios are as follows:

a) The car is repairable. If it’s in a tow-lot, plans should be set to get it out, as storage charges accrue quickly. Next, insurers should be notified of the location of the car, so an appraisal of damage can take place. If the insurers can be notified quickly, often they will move it out of the towing lot. In any event, discussion as to what’s going to happen one way or the other should be presented to you.

b) The car is destroyed, or “totaled”. If there is an outstanding loan on the car, you must supply the lender’s name and account number to your attorney so they can contact them to discuss payoff. Again, insurers must be notified of the car’s location, so it can be moved and they can appraise the value. You will have to sign over the title to the car, so be prepared to make it available quickly. If there’s a loan, usually the lender has the title, or a part of the title.

3. Plans should be set for you to get alternate transportation. Any good personal injury attorney should be able to recommend a reputable rental car company.

4. Plans should be set for you to get “the right type” of medical care. This means, in most cases, that you should be treating with an orthopedic physician, a chiropractor, or a general practice physician who provides physical therapy services. If you don’t have a family doctor who can refer you to “the right type” of doctor, or if you don’t know someone who knows such a doctor, your attorney should be able to give you the names of several reputable physicians near where you live or work. It is essential that you receive medical care if you are hurt, and that you get this care as soon as possible. Medical study after medical study shows that individuals who start medical treatment later end up needing more medical treatment than they would have if they had begun that treatment soon after the trauma occurred.

a) Good personal injury attorneys have many medical “contacts”. If needed, arrangements often can be made through your attorney allowing you to receive medical care without payment up front (or as you go). This is accomplished by a document called an “Assignment”. Both you and your attorney sign this document, and thereby agree that the doctor will get paid at the end of your case, from the proceeds recovered. In this fashion, the doctor is satisfied, because of the attorney’s reputation, that payment will probably be forthcoming. Your attorney should tell you that the signing of this document does not eliminate your responsibility for payment.

5. Your attorney should send out several letters within the first 24-48 hours after meeting with you. At a minimum, these letters are:

a) to insurers, advising you are now represented, and advising that all contact about your case should go through the attorney’s office;

b) to medical care facilities, requesting records, reports and bills;

c) to the accident witnesses, asking for statements, or requesting appointments to review what they saw or what they know;

d) to the investigating police, requesting the accident report.

The “middle stages”, where you get better.

Your attorney and his or her staff are now acting as both a “collection facility”, gathering records and bills from medical care providers, and continuing as a shield, keeping the insurance company representatives away from you. I often have clients call me and ask me “how’s my case going”? If case liability is not an issue, that is, if it’s clear that the collision was “the other guy’s” fault, and his/her insurance company has “accepted” responsibility, then my answer to the question is simply “fine, how are you feeling?” I say this because at that point, assuming we’ve “secured” the liability issue, all that remains is waiting for the client to get better.

A good personal injury attorney is able to review medical records and spot problems, either in the way the records are written (mistakes?), or in the overall medical course. I have called doctors when I have felt that certain diagnostic tests were questionable. I have called doctors when therapy seemed to be continuing endlessly without any improvement in my client’s condition. I have called doctors when bills seemed out of line. Your attorney should be knowledgeable enough to do the same, and should have the gumption to do so if and when appropriate.

The ending stages: evaluation of the case, and the settlement process.

ONCE YOU ARE COMPLETELY DONE WITH ALL MEDICAL CARE, AND ONCE YOU ARE BACK TO PRE-COLLISION STATUS, OR IF THAT’S NOT POSSIBLE, ONCE YOU’RE AS GOOD AS YOU’RE GOING TO GET, THEN, AND ONLY THEN, SHOULD YOUR ATTORNEY CONSIDER ATTEMPTING TO RESOLVE YOUR CASE.

Having said that, there are a few notable exceptions. First, the “statute of limitations” provides a limit on how long you have to either settle your case or file a lawsuit if your case cannot be settled. So, if you are not medically resolved, but the statute of limitations date is approaching, your attorney should meet with you and explain your options. Next, in many cases the total amount of insurance funds available (policy limits) will not be enough to truly fully compensate you. Thus, no matter how badly you have been injured, no matter how much your medical bills are, the insurance coverage available simply won’t be enough. Accordingly, the question presents as to whether it is reasonable to “settle” now, given that waiting will not produce any more funds for you. It may be reasonable to attempt to resolve the case, assuming all options have been explored, if this situation presents itself. Your attorney should explain your options.

Show me the money.

I recognize that most people do not voluntarily position themselves to be automobile accident victims. People generally don’t get hurt just so they can collect. Please don’t have misgivings about seeking money here. This isn’t about getting rich. This isn’t about fraud or trying to take advantage of the system. When an accident occurs and you are the victim, there is absolutely nothing wrong with feeling an entitlement to money. Our system of civil justice provides this, MONEY, as the only remedy. You are entitled to be compensated for medical expenses you incurred, for wages you lost, for mental and physical pain and suffering, for disfigurement, for aggravation, for inconvenience, for disrupting the quality of your life, and for more.

Any good personal injury lawyer will tell you his or her opinion concerning the value of your case, now that you have gotten to that “settlement-ready” posture. If they don’t know, or have an opinion, what are they there for? Your attorney should set out several things in writing to you BEFORE going to the insurance company to discuss settlement. These are:

1. How much the attorney thinks your case is worth.

2. How much the attorney is going to demand. Clearly, in the upcoming process of discussion with the insurance adjuster, the attorney must have room to negotiate.

3. How much you owe in outstanding medical bills. This will affect the “net funds” you receive.

4. Whether there are liens against the proceeds of your settlement. Health insurance, worker’s compensation, or a federal, state or local agency (Medicare, Medicaid) may have made some payments for your medical bills or to you for wages you lost. These groups may be entitled to be reimbursed. Again, this will affect the “net funds” you receive.

5. What options are available if settlement negotiations aren’t successful.

Is the lawyer going to attempt to mediate? to arbitrate? to litigate? You should know what all of these options are, if they are available, and what the pluses and minuses are with each. AND THESE should be compared to the settlement possibilities. It should be pointed out to you that if you get 95% of what you want through settlement negotiation, it probably isn’t a stellar idea to file a lawsuit, which forces delay, causes extra expense, and leaves the case unresolved.

6. Who is going to negotiate. I believe that if you hire an attorney, it is fine for the attorney to delegate non-legal, administrative matters to non-lawyer staff. On the other hand, I believe the attorney you hire should be the one who gets on the telephone and negotiates your case for you.

The very end, hopefully: a successful settlement.

Once the case is settled, the attorney should receive a check from the other party’s insurance company. You should see this check. It should have your name on it as a payee. It’s okay if it also has the attorney’s name as a payee. You should sign the check. The attorney should present to you a document similar to what I call a “Settlement Memorandum”. This document should detail the “money in” (the insurance check for settlement), and the “money out”, that is, all of the things which are going to be paid from that check. These will include the attorney’s fee, outstanding medical bills, any liens, and a “net” for you. The check should be placed into a special bank account which the attorney should have, called either an “escrow” account, or a “trust” account. This is an account where client funds are held, and attorneys are held to the highest of standards for the accounting of these bank accounts by attorney licensing authorities and bar associations. Routinely funds should be deposited immediately after the check is fully endorsed, and thereafter, funds should be disbursed within 5-10 days, the delay simply to allow the funds to “clear”.

After care.

Your attorney should complete all legal matters relating to your case. This means sending payment for all outstanding medical bills and liens. This means providing you with a copy of all of the checks written for those purposes. You should also either be given copies of the important items in your file (medical records, for example), or your attorney should advise you that he or she will keep them for your future needs.

Some Final Thoughts.

Good luck to you. Please drive safely. Wear your seatbelt. Put your kids in car safety seats. Don’t even think about drinking alcohol or using drugs and then getting behind the wheel. I hope you never get into an automobile collision. If you do, I hope you don’t get hurt too badly. Remember to keep your perspective. Remember that you are more important than your car. Take your time with the legal matters ahead of you.

Top Ten Reasons Why Law Firms Should Consider Selective Legal Outsourcing

In the last quarter of 2008 America faces economic challenges never imagined even a few months ago. How will businesses manage and survive the limitations on credit, demand and growth? How does the economic downturn impact lawyers and law firms which service the business community?

It is an obvious fact that businesses can only look at modifying two revenue streams, income and expenses, in order to increase profitability. If income is down and not expected to increase markedly in the near term, clients of law firms will take the hatchet to expenses in order to survive. Legal fees will be under extreme scrutiny. Legal outsourcing, while still a nascent industry, is gaining momentum, being considered in more corporate boardrooms. As the pressures to outsource build, lawyers ponder whether they should embrace outsourcing legal work offshore or resist it. In the face of global economic challenges coupled with the increasing loss of American jobs why would a U.S. law firm want to even consider legal outsourcing? Are there valid reasons why targeted legal outsourcing should be considered by every U.S. law firm?

Several weeks ago I received an email from a lawyer who was considering outsourcing some of the legal work of his law firm. Facing resistance and challenges from many in his law firm who wanted to maintain the status quo, he asked for my advice as to what he should tell his partners. Why should the firm outsource legal work offshore, a practice seen by some as adventuresome and risky, instead of staying the course, doing it “the way we have always done it.” I answered him with the top ten reasons why every law firm should consider selective legal outsourcing:

1. PRUDENT, TARGETED OUTSOURCING WILL RESULT IN REDUCED LAW FIRM OVERHEAD

Outsourcing some legal work to qualified providers in India will result in significantly lower overhead to the outsourcing law firm. In assessing the comparative costs the law firm will be wise to carefully calculate the real costs of employing one lawyer or paralegal. Those costs include salary and bonus, health insurance, vacation and holiday pay, sick time expense, FICA, office space and equipment for the lawyer, paralegal and secretarial staff assigned to that lawyer, pension and profit sharing, auto and parking expense, CLE seminar costs, and other employment benefits such as disability and life insurance. The real annual cost of one lawyer earning a base annual salary of $150,000-$175,000 is more likely in the range of $250,000 to $300,000 per year. NONE of these customary expenses accrue to a law firm utilizing supplemental offshore legal providers.

2. OUTSOURCING WILL ENHANCE LAW FIRM EFFICIENCIES

Selective outsourcing will improve the efficiency of your law firm. Because Indian lawyers work while American lawyers sleep, it will be like your law firm has a full time, fully staffed night shift. Some work can be assigned by a partner at 6 p.m. in the evening and the completed task on his desk when he arrives at the office the next morning. Litigation cases will move more rapidly through the court system with less need for extensions of time.

3. OUTSOURCING WILL RESULT IN IMPROVED LAWYER MORALE

As a child not many of the sermons I heard from my pastor stuck with me. But one, when I was fourteen years of age still rings a bell. He said: “Ninety percent of any worthwhile endeavor is pack work, plugging, day in and day out. Only ten percent of our work tasks are necessarily fun and enjoyable.” I have always remembered that statement. In more than two decades as a trial lawyer I enjoyed strategizing and trying cases to juries. But I did not necessarily enjoy all of the trial and deposition preparation, research and briefing, document review, and other mundane essentials of the practice of law. A law firm which incorporates outsourcing into its practice will inevitably foster more contented lawyers who devote their time and energies to the more challenging, fun and rewarding parts of the practice of law. Only the “chore” legal work is outsourced with the “core” work staying onshore. This allows more time for client interaction and development by the firm’s lawyers.

4. OUTSOURCING WILL RESULT IN OVERALL SAVINGS IN LEGAL FEES TO CLIENTS

Clients of law firms, particularly business clients, are searching far and wide for ways to cut their legal expenses. Many ask why they should pay, for example, $200 to $300 hourly for document review. Gone are the days when legal bills are simply paid without scrutiny. Likewise, the annual increases in hourly rates will not be well received by clients looking to cut costs. Wise law firms put the interests of their clients above their own. What is good for the client will ultimately be good for the law firm itself.

5. THE RULES OF PROFESSIONAL CONDUCT REQUIRE OUTSOURCING CONSIDERATION

The Rules of Professional Conduct of require that: a. “A lawyer should seek to achieve the lawful objectives of a client through reasonable permissible means.” (Rule 1.2) b. “A lawyer shall explain a matter to the extent reasonably necessary to permit the client to make informed decisions about the representation.” (Rule 1.4 b) c. “A lawyer shall make reasonable efforts to expedite litigation consistent with the interests of the client.” (Rule 3.2)

A lawyer is required to explore and discuss with his client all reasonable means of accomplishing the client’s objectives. A lawyer is not permitted to charge an unreasonable or excessive fee. It would seem that a lawyer is arguably required to discuss selective outsourcing as a way of reducing the client’s ultimate fee obligation and furthering the interests of the client.

6. OUTSOURCING “CHORE” LEGAL WORK PROMOTES CLIENT RETENTION AND DEVELOPMENT

Clients have long questioned ever-increasing legal fees for basic, “chore” legal work. However, they felt as if they had no alternative. They needed the legal representation and wanted good quality work. As there was not a significant degree of fee variance from law firm to law firm, clients tended to “stay put.” This trend is beginning to change as clients learn that they have options. Lawyers who outsource selectively are reporting a more contented, loyal client base. Clients who perceive that their lawyers are looking out for the entirety of the their interests, including fee costs, tend to remain committed to their existing law firms and even refer other clients (whose lawyers refuse to outsource).

7. THE COMPETITION IS OUTSOURCING

If your law firm is not outsourcing, be certain that your competition is. On August 21, 2007 Bloomberg. com reported that even long-established AMLAW 100 law firms like Jones Day and Kirkland & Ellis are outsourcing under pressure from clients.

8. OUTSOURCING U.S. LAW FIRMS MAY CHARGE A REASONABLE SUPERVISORY FEE

It is reasonable and acceptable for U.S. law firms outsourcing legal work offshore to charge a reasonable supervisory fee in conjunction with outsourced legal work. It is axiomatic that a lawyer who outsources legal work, whether to an associate, contract lawyer or offshore provider, ultimately remains responsible to his client for the quality and timeliness of delivery of the legal product. If a lawyer assigns the research and writing of a brief to a junior associate, the assigning lawyer will not customarily submit the final work product to the court without review and supervision. So it is with offshore legal outsourcing. Published ethics opinions of the San Diego, New York and American Bar Associations indicate that a lawyer who outsources offshore may charge a reasonable supervisory fee.

9. CLIENTS ARE INSISTING ON SELECTIVE OUTSOURCING TO ACHIEVE COST SAVINGS

Clients talk to one another. Executives of major companies golf and have lunch with one another. Corporate General Counsel attend meetings and CLE seminars, sharing information and ways to increase efficiencies and cut costs. They know about offshore outsourcing and the dramatic cost savings that can be achieved. It is unacceptable, therefore, to ignore legal outsourcing and, as one managing law firm partner told me, have “no appetite” for it.

10. OUTSOURCING WILL HAPPEN.

Doing nothing is not an option. Some are outsourcing. Many more are considering it, whether prompted by keen business sense or financial realities. Outsourcing is like a large, ominous wave a few miles offshore. It is preferable to surf the wave than wait to be engulfed, overwhelmed by its power and left wondering what happened.

British economist Herbert Spencer is credited with originating the term “survival of the fittest” in the mid 19th century. Although also having application to biology, Spencer applied the concept of survival of the fittest to free market economics. In a free market, companies and businesses will do what is necessary to survive. If that means outsourcing some U.S. legal jobs for the greater good of survival of the entity itself, then so be it. The model of ever increasing salaries and expenses for law firms followed by even higher legal fees charged clients cannot sustain itself any longer. Legal outsourcing is here to stay. The wise will take notice, survive and flourish.