Do Business Owners Rely on Professionals Too Much? (Do They Have Any Choice?) By Art Consoli, author of How to Evaluate and Profit from a Business Opportunity - The Entrepreneurs Guide I just had a conversation with a very successful real estate developer who told me two stories about lawyers; they are both worth passing on. In the first he mentioned that he had just received a bill from an attorney for sending a letter to a tenant who had not paid their last months rent. My friend said that the letter was less than a full page and the bill was for $1500. He decided this was excessive and took the bill to the attorney (his office was in the same building) and asked what was behind the charge. The attorney went on to explain that he had to do some involved research and then there was the time I took to get the letter exactly correct and the secretarys time to do the task and then file the appropriate back-up if further work were required. My friend, said the lawyer made it sound routine and that the amount was really too small to question. He almost implied that the time spent discussing the cost was almost an affront. My friend said he then told the attorney, Ill pay this bill but youll never get another piece of work from me. With that, the attorney reduced the bill to $500 -- a $1000 discount! This made my friend even angrier. His second story involved a lease negotiation. It seems my friend had paid an attorney (not the same one) to prepare a very thorough lease which he could use as a master lease with tenants for his various properties. In the course of events he used the lease with a new prospective tenant and got a reply from the tenant which contained such comments as: My lawyer said that such-and-such was excessive, and that this-and-that was probably not enforceable and should be stricken for clarity sake. There were more comments of the same type. The lease, with a number of strikeovers and new clauses was attached so was the lawyers letter. As my friend was going through the changes he began reading the letter from the lawyer. He noticed that it was the same lawyer he had used to create the master lease. My friend called him and asked him what was going on. Well Im not representing you now. And I do know where that lease has potential problems. So if you dont want me to take the other side of a negotiation and you dont want me to handle the actual use of the lease, then just put me on a monthly retainer. My friend feels as though the lawyers have taken way too much control over the businesspersons life. (I do too.) He points out that laws, which are created by lawyers, are behind all of the documents created by lawyers; generate the disputes which are argued by lawyers in front of a judge who is a lawyer. The playing field is not level, the deck is stacked against the non-lawyer -- and the lawyers fees keep rising. Have we, as business owners, reached the point where, to paraphrase President Hoover, we businessmen will have a chicken in every pot and two lawyers in our garage? My next article will discuss CPAs and how much they take out of the cash flow machine without adding to the quality of the goods and service produced. |
