The Indian legal fraternity is an interesting mix various stakeholders. Amongst all are the general counsel and external counsel that go through a very symbiotic relationship. For some it is a see saw effect for the others is a honey bee effect. While there are various pulsations that they go through, here are some of the major riders that are often talked about;
The Tangible Trust – In-house counsel take on business responsibility in several ways, one of them being supervising outside counsel. It is very important to have a certain element of trust between the in-house counsel and the external counsel. There is an inevitable sharing of confidential data in legal matters, and for an in-house counsel to be able to let an external legal consultant to have access to such confidential data can be a big parameter in the decision making process of an in-house counsel’s hiring process of the law firm/advocate.
The Compatibility Conduit – It is very important that an external counsel becomes a part of the team. Most external counsel have a “hired gun” relationship with their clients. The external counsel is responsible for providing the best service possible. However, it often so happens that when it comes to execution, the in-house counsel often becomes part of the execution team. Because the in-house counsel are part of the team, they can be much more proactive than the external counsel. So, while hiring an external counsel, an in-house counsel will always prefer a zealous go-getter, who is willing to become a part of the team, and just doesn’t limit oneself to advisory services only, but also takes part in execution.
The Intelligent Intent – The role of intent is a very sensitive and can be a very tricky thing when it comes to developing and maintaining relationships between the in house and external counsels. Despite several mutual synergies, usually an outside counsel’s interests do not align very well with the clients’. All said and done, the law firm has its books and numbers to prioritize, and doing so inevitably diverges with the client’s profit maximization. Hence, while hiring an external counsel, an in-house counsel will always choose someone who would display a greater ownership of outcomes and overall interests of the company.
The Mighty Size – Any large law firm would entail higher overhead cost, leading to higher hourly rates. Still, larger firms have a number of advantages over smaller ones. In the recent years, lawyers have started specializing in their chosen practice areas. A smaller law firm or independent practitioner may not necessarily have the ‘all-rounder’ skills a company would need to grow in a strategic manner. Hence, in a lot of cases it makes sense to hire a relatively larger full practice law firm for an overall strategic legal advice.
However, a number of in house counsel these days have started preferring to hire boutique law firms on a matter-to-matter basis. Over the years, the role of in house counsel have substantially evolved within a company, and so has their team’s. More often than not, one would find an in house team capable enough to handle a large number of legal needs by themselves. Hence, the need for hiring an external counsel only becomes prevalent on complex or super-specialized matters only.
The following 2 are some one of the key parameters that an in house counsel would focus on when choosing between a boutique law firm or a larger full service law firms are as follows:
Experience – There always remains a focus on the firm’s experience and history in handling the matter(s) they are being considered to handle. This is crucial as it directly affects the time, cost and outcome of the matter.
Informed – It is important that an external counsel is an extension of the knowledge center that the in house counsel builds within his/her own set up. So staying up-to-date on the legal regulations and how it affects the business at large is a continuing process that an external counsel is inexplicably expected to adhere by. Also, it is important that s/he be willing to take the time to educate the in house counsel’s team about the intricacies involved in the legal matter of your business, and explain every step of the way on how it affects the way you do business so that you can spot problems well in advance.
So are you ready to strike the balance between?
This article was first published in the Lex Witness September 2016 issue.