Companies facing a litany of legal issues often choose to retain an attorney full-time. Called “general counsel” to the business, the attorney will be tasked with handling a diverse range of legal matters pertaining to the company. Because an attorney can only maintain expertise in a limited range of subjects, where the personal expertise of an individual attorney is inadequate, an important function of general counsel is to work with outside lawyers who have adequate expertise.

Small businesses that are just starting out do not necessarily want to hire a full-time attorney to begin with, as doing so can be prohibitively expensive. A full-time attorney, including salary and benefits, office space, administrative support, research tools, and other expenses usually costs upwards of a couple hundred thousand dollars per year at the bottom end. Also, the company usually will not have enough legal work to require a full-time attorney.

However, if the small business is growing quickly and is involved in many activities or relationships, then a full-time attorney can ensure that all potential legal issues are accounted for and dealt with properly. There are four relationships or activities that cause small businesses a great deal of liability and call for the need of an attorney. These relationships are between the company and partnerships, suppliers, employees, and customers. Businesses involved in these relationships should consider retaining counsel due to their risky nature. Retaining a full-time attorney is a proactive way to ensure these relationships are cared for and that the company is protected from liability.

General counsel does require some level of autonomy in the company in order to properly manage company relationships. In addition to managing relationships, an attorney can do several more things to protect the company including:

 

  • Administer legal audits of the company on a regular basis to ensure the company is in good legal standing.
  • Manage contracts and other legal documents to stop multiple versions from being created.
  • Monitor intellectual property to ensure that others are not infringing on any of the company’s rights.
  • Ensure the company has appropriate insurance coverage for all activities and the activities of key partners or contractors.
  • Monitor the company’s relationships and most importantly those relationships that can result in significant liability.
  • Advise different branches of the company and ensure compliance with laws, policies, and regulations.

Overall, general counsel provides a way for companies to find and prepare for the inevitable legal hurdles that will come. Whether by one attorney or several, retaining counsel is one way that liabilities can be managed and lessened.

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