When does it make sense for a small company to seek legal advice?
When you first start a new company, legal advice is something that probably isn’t on your mind right away. After all, what kind of trouble are you going to get into with customers or other businesses? There’s a small chance that larger companies are going to take notice of you, and your computers probably don’t expect much from you anyway.
Sadly, this kind of thinking can often kill entire businesses. It’s this level of complacency that usually lands businesses in all kinds of messes. The reality is that no matter how far your company has progressed, it makes sense to seek legal advice whenever there’s even a shred of doubt on your mind. However, we understand that it’s not entirely realistic for a company to hire a dedicated lawyer, especially if they’re just getting started.
So when does it make sense for a small company to seek legal advice? What situations require a lawyer, and when should you go the extra mile to look for a reputable professional to defend you or help you sue another company?
If there’s any doubt about something, you should probably hire a lawyer
One of the simplest ways to decide if you need a lawyer or not is to consider how much knowledge you have about a certain situation. If you’re 100% confident in a certain outcome, then there’s a chance that you probably don’t need help. However, if there’s a complicated process that you’re unfamiliar with, then it’s usually best not to be complacent or overconfident in your abilities.
This may sound extremely vague, but here’s a good example of what we mean. Let’s say that your new product has already been copied by a competitor. You’re fairly confident that it’s the same design as yours, and even the branding around it has blatantly been copied by another company. Many people would immediately think that this is grounds to take legal action, but do you really have a chance of winning? In this case, it’s often best to seek legal advice to see if there’s actually anything you can do. Have you taken steps to seek copyright protection? Would their use of your ideas be under some kind of fair use law? These are all complicated topics that will require legal advice no matter how confident you think you are.
And for the sake of completion, a good example of when you shouldn’t seek legal advice is when there’s something common like a parking ticket. If you hire drivers and one of them got a parking ticket, you don’t really need a lawyer to seek justice or advice. Simply pay the fine if it’s deserved and move on. Even though it might be related to your business, it’s a simple case that shouldn’t require extra thinking or effort on anyone’s part. While there aren’t many situations like this where it’s clear you don’t need to seek legal advice, it’s still worth mentioning because it’s easy to overcomplicate things when you run a company.
In short, if there’s ever a difficult situation where you’re not sure if you need legal advice or not, it’s generally best to seek it from a reputable professional.
Contracts almost always require you to have legal advisors
Legally binding contracts can be scary things. If a small business signs a contract without really thinking about it, then there’s a good chance that they’re going to be screwed in the future and there’s really nothing they can do about it unless the contract has some incredibly heinous clauses. If you ever decide to work with another business, you absolutely need to seek commercial legal advice before you sign or agree to anything. If there are contracts involved, they need to be read properly by a legal advisor so that they can pick up any strange clauses that could be used against you in the future.
Of course, not every business that you work with is out to get you. Contracts generally aren’t drafted with the intention of screwing over partners, but there are occasionally clauses that clearly benefit the one who wrote the contract. After all, they’re the ones that drafted it, so it makes sense that they’d have the upper hand. Thankfully, working with a reputable legal team can ensure that changes will be made to the contract until both parties are happy with the terms.
Managing business contracts is one of the most common situations where having a legal team really helps you out. While you might be confident in your ability to parse legal contracts and understand all of the complex literature, it’s never a bad idea to have a second opinion on it. So whether you’re signing a contract with a business partner or are interested in working with freelancers, having a legal expert help with your business contracts is generally the best way to ensure that everyone is happy.
Business lawyers can be surprisingly helpful when it comes to growing your business
Business lawyers are often used to dealing with a plethora of different legal troubles. Whether it’s copyright laws, business contractors or even protecting a company from being sued, they have a lot of major responsibilities that can be considered reactive actions. However, business lawyers can also come in handy when it comes to proactive actions, such as helping a business plan ahead for future growth.
This is because business lawyers have a deep understanding of business law. They have plenty of experience with businesses and they understand how to make your company more attractive to the right people such as investors and customers. While it’s not necessarily considered legal advice, it’s still extremely helpful when it comes to understanding where your business stands among your competitors.
The legal advice offered by a business lawyer doesn’t always have to relate to negative things such as suing other companies that are copying your products. Sometimes, business growth can be spurred by having an experienced lawyer analyse your business and provide sound advice for future growth.
So when should a small company seek legal advice?
We’ve covered a lot of in-depth information about when small businesses should be using legal experts, but when exactly should a small company seek legal advice? Let’s condense the information and give a few clear-cut examples of when you should be looking for advice.
When you’re about to draft or sign a business contract
If you’re about to draft or sign a business contract then you’ll want to try and seek legal advice as soon as possible to help you understand every clause. If you’re drafting a contract, then you’ll want to ensure that it includes every possible protection that gives you peace of mind when working with another business partner or client. When you’re due to sign a contract, it helps to get another pair of eyes to examine the contract so you have a better understanding of what every clause implies and the rights that you have should something go wrong.
When you’re unsure about your business structure
There are many different types of business structures and it’s important that you understand them if you want to establish the right foundation for your company. Different structures offer different benefits, but they can also come with disadvantages that might work against the way you want to run your business. It’s best to seek legal advice on terms such as sole trader, limited companies, and limited liability companies so you know exactly what benefits they offer.
When compliance is a concern
Whether it’s GDPR compliance or meeting certain standards to show that you’re a reputable business, it helps to seek legal advice when you’re unsure about compliance concerns. Failing to do so could cost you revenue and may ruin your reputation as a professional company or partner to work with.
When you’re looking to buy or sell a business
Buying and selling businesses are more common than you might think, but no two cases are the same and there are usually a lot of discussions that have to take place before a deal is successfully made. As such, you’ll want to seek legal advice as soon as possible to ensure you get the best possible deal.
When you need to protect your intellectual property
Copyright lawyers and trademark lawyers are among the most common types of business lawyers that you might contact when running a business. After all, you want to protect your intellectual property and fight back against copycats. However, do keep in mind that there’s only so much that lawyers can do to protect your products, services, and ideas if you haven’t already done something to protect them yourself. You can’t apply copyright retroactively in most cases and failing to defend your property
When you’re thinking about growing your business
And lastly, if you’re thinking about growing your business then it helps to have a professional at your side giving you advice. Whether it’s how to structure your business for the future or how to protect your intellectual property, these are important concerns that a legal expert can help with.