April 2017 - Wealth Warning- Instructing A Solicitor

Avocet has been involved in Selling & Buying businesses on behalf of clients, for over 13 years & knows the client value (not cost) of a good Solicitor in terms of:

  • getting a transaction done as quickly as is practicable
  • protecting the client’s interests, both now & in the future

Instructing a Solicitor is NOT like shopping at a supermarket on price, it requires careful consideration: which is why Avocet implores its clients to think EARLY about this- regrettably too many don’t, with damaging consequences.

As Mergers & Acquisitions activity picks up , good Solicitors with spare capacity are becoming hard to find.

The Credit Crunch, increased regulation & a sharp rise in Professional  Indemnity Insurance premiums have all taken their toll with a 25% decline in Sole Practitioner & 2 Partner Firms, & a 10% decline in the overall number of firms.

When Does The Meter Start Ticking?

One of the most common problems that Avocet encounters is people  Instructing a solicitor too late. This often leads to a poor choice of advisor or unnecessary costs being incurred. The main reason for this is FEAR of the meter ticking, but in practice this should not be a problem.

In reality, any good solicitor will, prior to acting for a new client, provide an initial FREE consultation. You are also entitled to request that the Solicitor then sets out exactly what is to be done and what it will cost.

The meter has not started to tick!

You can at this stage either agree to the Proposal & Instruct or look elsewhere.

The meter has STILL not started to tick !

Remember all Solicitors are under a duty to keep you fully informed of costs & you should NOT receive unwelcome surprises

How Do I Select A Good Solicitor?                                                                       

Potential names can be sourced by Word of Mouth recommendation or visiting the Law Society website. Then these names need to be evaluated using 3 criteria:         

  • Experience & Expertise
  • Size                                                                                                                               
  • Chemistry & Communication                                                                                                                  

Experience & Expertise: just because “George” did a good job with the Conveyancing on your house, that does NOT necessarily make him the right man for selling your business!

Relevant experience is required in terms of fairly regular work in this area plus of course is he or she any good at this work ?!                                                           

Don’t be afraid to ask for references: any good solicitor should be able & willing to provide them.    

Size: this DOES matter because bigger is NOT necessarily better !

What is the point of instructing a large firm with a straightforward sub £1m deal when the other party is fielding a small local firm.

The potential problems include:

  • Antagonism between lawyers at YOUR expense
  • Sledgehammer to crack a nut legal documents designed for multinational deals
  • The likelihood of a junior recently qualified Lawyer being assigned to your deal & therefore overall destruction of value by using a Ferrari to go to the dump

Chemistry & Communication: can you & the Solicitor get on, if not, how can you be effectively represented?

It may sound obvious but find a Solicitor who “speaks your language”. If you don’t understand half of what you are being told, say so, because it is their problem, not yours.

Do Brief The Solicitor Properly

Rather like the shoe box of financial data dumped on an Accountant to make sense of, an inadequate legal briefing will undoubtedly mean reduced quality of advice & higher fees. Spend time working out what the issues are & if necessary ask for help from an Adviser regularly involved in such transactions, to help prepare the briefing.

Summary

Good Solicitors are in short supply

The meter starts ticking later than you think, so don’t be afraid to Instruct EARLY

Be careful how you select a Solicitor

Brief your Solicitor carefully                         

Conclusion                                                                                                                  

In view of the above, start the Solicitor Instruction process EARLY & put your German Towel on a good one NOW !      

For further advice on Instructing A Solicitor  contact  Roger Bibby at Avocet Investments (office Amersham)                                                                                                                             roger.bibby@avocet-investment.com, 01494/726173

Return to all news stories...

Let Us Help You Today