Wednesday, 24. July 2024

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As a larger company, getting legal advice from a small law firm or sole practitioner?

Occasionally, one has the impression that larger companies have reservations about seeking legal advice or legal representation from a small law firm or a sole practitioner. Why is that?

1. Mind you, if you are Mercedes Benz and want to merge with BMW, then of course I fully understand that you would rather seek advice from a large law firm. Why? For such transactions, you need manpower, i.e. a sufficiently large team that can review documents, draft contracts, perform due diligence and conduct a lot of lengthy negotiations in a relatively short time. As a rule, a single lawyer cannot do this.

2. But of course, the qualified individual attorney can also competently draft or review complex logistics contracts or commercial leases. And the qualified individual lawyer can also tell you whether a transfer of business within the meaning of § 613a BGB has occurred. As a client, you do not need a large law firm for this.

3. But in a large law firm there are always several attorneys working on a case, four eyes see more than two, and that is better for me as a client, isn’t it?  

a) In my opinion, this is not true. Even in larger law firms, cases are usually handled by one lawyer. And this is not always the lawyer who conducts the “introductory talk” with you and then also signs the bill at the end, but very often rather the younger colleague whom you have never heard of.

b) With a sole practitioner, on the other hand, you know who is handling your case. He or she is available to you as a contact person, and you can usually find out about his or her qualifications and experience in advance from the firm’s website.

4. But you want to be represented by a well-known law firm whose name you have already read in the newspaper?  

OK, but: If you go to, let’s say, Freshfields, probably the largest commercial law firm in Germany, then you will not be advised there by the founder, Mr. Freshfields. He, I assume, has been dead for a long time. And if you are not a large company yourself, then – believe me – your case will not be handled by the senior partner of the large law firm you may know from the business pages. …

5. And what does “available 24/7” mean?

Have you really reached your lawyer if, when you call, the receptionist answers after 3 seconds, who then forwards you to your lawyer’s second secretary after 5 seconds, but she unfortunately has to tell you that your lawyer is currently in a meeting? – I think no. Here a constant availability is only feigned.

b) The individual lawyer, on the other hand, may not answer the phone immediately when you call. But he will usually call you back personally after a short time if you leave him a message on his mailbox or by e-mail. So for me, the latter represents the greater presence.

6. But you are looking for the top specialist for each area of law, the number 1 of the „Focus“ list, in whatever way this ranking is created (or bought?). …

a) Yes, but why is that? The vast majority of cases are more or less standard cases that can be properly handled by a qualified specialist lawyer. Look at it this way: If you have broken your leg, then in most cases any qualified surgeon can treat it properly. You don’t need the “number one top leg fracture specialist” to do it. Going to a top specialist may make sense for the 5% of really complex and difficult special cases that could „overwhelm“ a normal specialist or specialist lawyer. For the 95% of other cases, i.e. the absolute majority, a normal specialist lawyer is quite sufficient. It is very likely that you will get just as good a service there, but at a significantly lower price.

b) To be more specific: For a normal case of dismissal, whether on the employer or employee side, you do not have to go to a “dismissal expert” who has written ten books on the subject, but rather any specialist attorney for labor law can advise you competently and properly and also represent you in court. Another example: Any specialist lawyer for commercial and corporate law can establish a GmbH, transfer shares and draw up management contracts.

c) Of course, if you want to set up a branch in Luxembourg for your SE (Societas Europea) in a tax-optimized manner, or if you want to create complex Cum-Ex constructs as a bank (nice, isn’t it?), then you’d better go to the top specialist from the large law firm. But for standard cases, I think you are also in good hands – and maybe even better – with a sole practitioner.

7. Conclusion: So, dear entrepreneurs and also larger entrepreneurs: Have the courage and entrust your larger legal matters to a competent sole practitioner. You will be surprised how much more you get for your money than you might expect. …

Dr. Wolfgang Gottwald
Rechtsanwalt/Attorney at Law

Attorney at Law

Leopoldstraße 51
80802 München

Tel.: 089/383 293-10
Fax: 089/383 293-13