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Hiring in-house counsel

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Question:

What are three issues nonprofits should consider when deciding whether to create an in-house counsel position?

Answer:

* Review your business model.

What does your organization do and how does it affect your need for legal advice?

If you’re an activist organization that engages in nonviolent action that could leads to breaking the law, you may find yourself in need of legal support on a regular basis.

But even an organization like ours that primarily provides education and networking opportunities for our members has need for legal counsel, as we often take advocacy positions on complicated legal issues.

Or you could have more traditional legal needs such as reviews of vendor contracts, partnership agreements or licensing deals.

You should look beyond your current work as well.  What else might you be doing down the road that will require legal advice or oversight?  What is the best way to obtain the legal advice you will need?

* Look at your bottom line.

How much are you paying your current legal advisors, how often do you require their services, and are you paying for routine services such as legal review or for representation in a lawsuit?

One of the benefits of creating an in-house counsel position is a reduction of your legal costs.

Now activities such as general review and oversight of agreements can be done for a less-than-exorbitant hourly rate.

And in-house counsel will be more qualified than a non-lawyer to review outside legal bills and make sure your organization is being charged fairly.

That being said, having in-house counsel doesn’t preclude a need for outside counsel support, but your organization will be in a better position to anticipate and manage the costs involved.

* Ask yourself what more you could be getting from your legal counsel.

In-house counsel have a big advantage over their outside counsel counterparts.

They know your business, they can offer strategy and advice that goes beyond pure legal analysis and, as a result, provide advice with more depth that takes into account the realities in which you work.

In addition, in-house counsel can be more responsive. You don’t have to wait for a call back or schedule a meeting. If an urgent legal matter arises, you have an advisor at the ready.

Also, outside counsel are often called upon when a legal issue arises.

In-house counsel can help your organization be proactive and design its operations with the law in mind, helping to prevent activities that might cause your business legal problems down the road.

— Compiled by Leslie Williams


Frederick J. Krebs is president of the Washington, D.C.-based Association of Corporate Counsel, which serves 19,000 attorneys practicing in the legal departments of nonprofits, corporations and other private sector organizations.

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