Commercial Real Estate Mastery: Episode 35
The Insider Guide To Attorneys
Nobody likes attorneys, but they can be a necessity in certain situations. But, that being said, there are some things you should know regarding how to work around lawyers. In this Commercial Real Estate Mastery podcast we’re going to explore how to handle the selection and management of attorneys.
Episode 35: The Insider Guide To Attorneys Transcript
There are 1.37 million lawyers in America. That means there's more lawyers than there are people in the United States military. We have more lawyers in America than every other country in the world combined. Americans have a favorability rating on attorneys of only about 20%. In fact, it's one of the lowest ranking of all careers. It's even worse than car salesmen anymore.
So the bottom line is, most of us don't like lawyers. But at the same time, in some cases, lawyers are a necessity. So how do you work with them? This is Frank Rolfe with the Commercial Real Estate Mastery podcast. We're gonna talk about the insider guide to attorneys, things that you need to know about working with law firms. And let me say on the front of this, I'm not a lawyer, never have been. I don't like lawyers any more than anyone else.
My brother is a retired lawyer out in Manhattan, and I'm pretty familiar with lawyers, 'cause over the years, we've had to use them many, many times on different projects. But there are some things you have to know as a consumer when you are hiring an attorney, which is effectively a knowledge worker, someone who sells their knowledge. There's certain tricks and things you have to be aware of or you might end up having real dire problems with that relationship.
So here's some of the things that nobody's gonna tell you about working with attorneys. Number one is, a bad one is worse than a good one in a small firm. So a bad one in a big firm is not going to be as effective and not going to be able to get what you want any more than an attorney in a small firm. So when you look at attorneys, don't just go with the biggest firms. We've used some attorneys at smaller firms, we've used some attorneys in strip shopping centers, and yet they had more talent and more ability to get the job done, yet they're a lot cheaper.
So when you make your short list of potential attorneys, don't just pick the ones with the biggest offices and the largest number of attorneys. What you have to vet is the actual ability of that individual lawyer. Also, experience is essential because you don't wanna pay for their learning, right? To many attorneys, the deal is, it's kind of a 'earn while you learn.' So if they haven't handled a case like your case, if they have no specialty in that arena, don't go with them. Don't be paying for their educational experience. It's kind of like if you went to the hospital and there were two surgeons.
You had to have an operation. You've got the one that's in their mid-50s, been a doctor, performing the surgery for two decades, and then somebody else who just got out of medical school three weeks ago. Which would you go with? Of course, you'd go with the older doctor. Because when it comes to legal matters, just like medicine, experience is extremely important. And another thing you may not be aware of, but hourly rates are fully negotiable with attorneys. Even the guys in those big firms with mahogany-paneled waiting areas, they wanna give the vestige that you can't really ask about rates, that that's just crude and crass and you're a low-class person.
But that's not true. Most every law firm does negotiate their rates if you only ask. So if the attorney in question's hourly rate is $400 an hour, does that mean they would do the job for 300 an hour? Possibly. So just say to them, "Look, based on my budget, I'm worried that you're too expensive. So what kind of a rate can you really go with?" And they will often, if you press them on that, they will, in fact, lower down their pricing. It is fully negotiable. Also, interview several attorney candidates. Don't just go with the first one that answers the phone or the first one that you get.
You need to select one that's got the experience, that's got the quality and the price that you need to get the job done. And just like when you vet different employee applicants for your business, you wanna talk to several. So don't just take the lazy route, talk to the first guy and say, "Oh, okay, you're hired." Instead, tell them briefly what the case is about and then see if you think they're the person. I'm not saying you have to do it in person. You can do the interview over the phone, but don't just jump to the conclusion that God meant you to go with the first attorney that actually talked to you, because that's not a way to get the right one. Also, feel free, since real estate is a very specialized industry, to talk to different groups and associations to find out what attorneys they might recommend. If you're looking at something in the realm of apartments, talk to the apartment association.
Who are they using? If you're looking for something on a mobile home park, talk to that state's mobile home association. Get lists of attorneys that they are aware of, who are members, who have expertise in that sector of real estate. Because that can make all the difference. If you hire someone who does not know anything about your sector, you're gonna pay a big bill for them to learn about it. And even then, they're not experienced in it, so they won't do a very good job at all. Also, if an attorney does not perform for you, if it's not going well, just go ahead and fire them. It's kind of like The Apprentice show. If it's not working out, just kick them out and get somebody different.
Because an attorney is nothing more than a person, and you're trying to give them an assignment, and not all employees work out. There's an old saying, "It's easier to change people than to change people," and that's entirely true when it comes to attorneys. So rather than trying to figure out why the attorney is no good or get them into psychological counseling, it's a whole lot easier just to go out and get somebody new and different and give them a shot. We've had many cases where the existing lawyer was flailing, getting nowhere. We swapped them out with a new and different attorney, and it totally turned things around. So don't feel like you're stuck with them until the end of the earth. Finally, when it comes to working with attorneys, you've got to use, to some degree, your gut instinct.
Before you talk to the attorney, go on AI and put in a whole lot of questions to get a feel for: What is the strategy? Where should this case go? What case law is there? What are your odds of success? What could the financial aspects be if you lose? What should the legal fees be? It's amazing how much information you can garner on the world of law today from AI, because AI sums up pretty much every case that's ever been done. AI has read it and is able to bring it out if you only ask the right questions. It's not like the olden days where no one had any clue or any idea on anything.
Today, literally by popping open the old laptop and putting in some key questions into artificial intelligence, you can learn a ton. You would never wanna talk to attorneys about a case without starting to give your vision of where this case should go. And even though you may not be a lawyer, you probably have some degree of business background, you've got some good old adult-honed common sense, and with a little AI, little extra research, you yourself can become kind of a dangerous armchair quarterback to help instruct the attorney, to ask them what their plan is, to give them your feedback on the plan that they have chosen. This is Frank Rolfe, the Commercial Real Estate Mastery podcast. Hope you enjoyed this. Talk to you again soon.
