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Solicitor Solo AMA

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10 hours ago, Mountebank said:

I was in my second year of call (now third) and am happy with the decision. I enjoy running the business side of things and like that I get to keep all the profits (such as they are). There are some things I would have done differently which I won't go into (as they mostly relate to staffing), but otherwise am content with most the choices I made. It is important to educate yourself as much as you can beforehand and have a plan/vision in place for as many technical aspects of the practice as you can (from banking arrangements, general client and  practice management, and IT setup, to precedents, forms, and internal office procedures, etc.). You also have to commit a certain amount of effort and money ahead of time (I told my wife when I started that I planned on making a go of it for three years. If, after that, I was crashing and burning, then I would go find a job).

If I did it again, though, I would have reached out to other sole practitioners earlier on. The senior bar are a great resource and, in particular, other soles tend to support each other. They are a helpful resource for more difficult files and are usually pretty generous with their time. It's also nice to keep contact with other lawyers since it can get a bit lonely being on your own (even if you have staff and are seeing clients daily, you're still very much alone without any colleagues around for fraternity). I try to have lunches when I can with some of my colleagues, just for some social contact with my peers (besides, these lunches are often ultimately profitable in any event). I still need to reach out more, but it's a little harder in a local bar like mine (being a veritable sea of grey and white hair).

I also could have done a better job minimizing start-up costs. I made some mistakes at or near the beginning which ended up costing me (going with a poor service provider, probably overpaying for some equipment/furniture, and paying for licences that weren't suitable for me). These are things that I rushed into out of a desire to get all the parts in place. On the one hand, you really do have to move and make decisions quickly to get things up and running in a client-facing way as soon as possible. On the other hand, if I skimped and went without a bit more, I could have been smarter about when and where I was spending my money. I am still feeling the effects of some of these decisions and my monthly expenses are more than I want them to be, but mostly things have smoothed out and my expenses are still reasonable, even if a little more than I'd like (I'm talking on the order of hundreds, not thousands, extra).

That all having been said, I am not even a year out so am probably not the best person to offer a retrospective. That is, I'm still in the thick of it (but I guess that will always be the case).

Wow the 2nd year part surprised me. As someone who just wrapped up articles, there's so much I KNOW that I don't know. I feel like even two years from now, I'd be afraid to go out and offer legal advice, let alone manage the the other facets of a solo practice. 

If you don't mind me asking, what convinced you that marinating for "only" two years in the legal field is enough to competently go out there and play lawyer. I was under the impression I probably needed to build a rolodex of clients and learn for a good five years before even thinking of such a move. Look forward to your thoughts!

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8 hours ago, hmyo said:

Wow the 2nd year part surprised me. As someone who just wrapped up articles, there's so much I KNOW that I don't know. I feel like even two years from now, I'd be afraid to go out and offer legal advice, let alone manage the the other facets of a solo practice. 

If you don't mind me asking, what convinced you that marinating for "only" two years in the legal field is enough to competently go out there and play lawyer. I was under the impression I probably needed to build a rolodex of clients and learn for a good five years before even thinking of such a move. Look forward to your thoughts!

I have some brief thoughts on this.

  • Going solo is not for everybody and even for those that do go solo, it's not for all of them at the same stage of their career.
  • Being on your own early does require a certain type of confidence, but nothing extraordinary. In fact, overconfidence can be pretty dangerous. Your clients will know you are not a seasoned lawyer. If someone comes in with a novel or complex situation it's okay to tell them you don't know the answer or can't do it. You do need some confidence in yourself, generally, and in your basic competency. This is a constant tension though: clients and members of the public will frequently ask you legal questions of all sorts and it's very easy to kind of overstep your competency zone and give an opinion about something when you probably shouldn't. Ex., maybe you don't do family law but you have some exposure in limited contexts from some solicitor work. A repeat client who has used you for his mom's estate, home sale/purchase, and his Will in the last year is splitting up with his wife. He says he is broke and can't afford the retainer for a family lawyer - his business tanked during Covid and he had to shutter it for good. His wife's lawyer prepared a simple separation agreement. He doesn't want your full legal opinion since he knows you don't ordinarily practice family law. He's pretty sure he's going to sign it but can you just take a quick look and let him know if he is getting hosed in any major way? 
  • From the perspective of a run-of-the-mill solicitor who does things like real estate, wills, estate administration files, corporate, etc., a couple of years experience is probably enough for some people to get a decent handle on the normal files. In particular, for residential real estate, wills, estates, and simple corporate stuff, ~80% of your files will be pretty standard and not that complicated. A lot of the battle on this 80% is non-legal stuff, like making sure your practice is running efficiently. One experienced staff member can help a lot. I think it's natural for some people, after a couple of years of practice, to start to think - "gee, I don't need all that much support anymore. why should any of the fruits of my labour continue to go to someone else?"
  • For the small percentage of files that are more complicated you'll probably need a mentor of sorts or at least a few senior lawyers in your town who you can reach out to. Most lawyers love to show off their intelligence/experience so if you are friendly, getting them to help you out is not hard. You can also self-educate from other resources, sometimes.
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Completely agree regarding the above. It's a difficult balance, because on the one hand you have to be concerned not only about the things you don't know, but about things you don't even know you don't know. On the other hand, if you let that creep in too much, you'll get paralyzed by it and live in an inert state the rest of your career. Like any new business, at some point you just have to be OK with taking on unknowable risks (like, maybe there will be a global pandemic shortly after launching your new enterprise...). If you can't even strike while the iron is hot, then you never will at all.

Ideally, it would have been nice to have another year or two in practice before I went for it, but I had recently been able to put a little bit of money away from the sale of an investment, things at home were stable, and I was increasingly dissatisfied with my job. If I didn't strike out on my own under those circumstances, I was never going to. I'm still a young guy, but I was already starting to notice a little bit of my risk tolerance slipping away so I knew I had to take a leap.

The hardest thing, as @BringBackCrunchBerries alludes to, is not turning down new clients with issues that fall outside the scope of your practice, but turning down existing clients with work adjacent to your area. I've been going through this very situation recently. I have a new client, self-employed businessman, who is younger than me and already way more successful financially (it's actually shocking what he's been able to accomplish for himself and things are only looking up). He's going to be a big fish one day and I'm basically his first lawyer. Already, he's come to me with four separate matters in as many weeks. I haven't just done some work for him, I'm becoming his (and maybe one day, his family's) go-to guy for legal issues as they come up. I can't afford to lose this guy.

So, he comes to me with four matters, one of which is my core practice area, one of which is entirely outside the scope, and two of which are adjacent. Like most business guys, he's not one for verbosity, so he'll send me a one-line email introducing the issue and asks if I can take care of it. I reply same-day with something to the effect of "no problem. Call me when you have time". That's the kind of service he likes and so that's what I give him. Behind the scenes, I'm doing tons of research that I can never bill for and reaching out to as many senior lawyers as possible about these two matters (these matters were actually really inside of my practice area, though maybe not at its core, but there were enough complications and special things going on that they were beyond my expertise). At the end of the day, once I'm satisfied that, through the help of others, I have a handle on things, I give him a bit of a very brief summary of some of the complications and my proposed solutions and next steps (he's happy that I spotted some issues he wasn't aware of and key to this is that I only tell him about these after I have solutions for him. But mostly he's just glad that, by paying me, he can put these things out of his mind and use his mental energy elsewhere).

So, at the end of the day, the client is satisfied, I've done good work, and I've complied with my professional obligations. Sure, I had to do hours upon hours of work I can never bill for (which also means I didn't bill out other files I could've worked on instead), but I got to keep his business, do some business development with some senior calls nearing retirement, and learn some things I will probably draw on again in future. If you want to go solo, you have to be interested in the long game and I'm not going to be a junior call for very long.

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3 hours ago, Mountebank said:

Completely agree regarding the above. It's a difficult balance, because on the one hand you have to be concerned not only about the things you don't know, but about things you don't even know you don't know. On the other hand, if you let that creep in too much, you'll get paralyzed by it and live in an inert state the rest of your career. Like any new business, at some point you just have to be OK with taking on unknowable risks (like, maybe there will be a global pandemic shortly after launching your new enterprise...). If you can't even strike while the iron is hot, then you never will at all.

Ideally, it would have been nice to have another year or two in practice before I went for it, but I had recently been able to put a little bit of money away from the sale of an investment, things at home were stable, and I was increasingly dissatisfied with my job. If I didn't strike out on my own under those circumstances, I was never going to. I'm still a young guy, but I was already starting to notice a little bit of my risk tolerance slipping away so I knew I had to take a leap.

The hardest thing, as @BringBackCrunchBerries alludes to, is not turning down new clients with issues that fall outside the scope of your practice, but turning down existing clients with work adjacent to your area. I've been going through this very situation recently. I have a new client, self-employed businessman, who is younger than me and already way more successful financially (it's actually shocking what he's been able to accomplish for himself and things are only looking up). He's going to be a big fish one day and I'm basically his first lawyer. Already, he's come to me with four separate matters in as many weeks. I haven't just done some work for him, I'm becoming his (and maybe one day, his family's) go-to guy for legal issues as they come up. I can't afford to lose this guy.

So, he comes to me with four matters, one of which is my core practice area, one of which is entirely outside the scope, and two of which are adjacent. Like most business guys, he's not one for verbosity, so he'll send me a one-line email introducing the issue and asks if I can take care of it. I reply same-day with something to the effect of "no problem. Call me when you have time". That's the kind of service he likes and so that's what I give him. Behind the scenes, I'm doing tons of research that I can never bill for and reaching out to as many senior lawyers as possible about these two matters (these matters were actually really inside of my practice area, though maybe not at its core, but there were enough complications and special things going on that they were beyond my expertise). At the end of the day, once I'm satisfied that, through the help of others, I have a handle on things, I give him a bit of a very brief summary of some of the complications and my proposed solutions and next steps (he's happy that I spotted some issues he wasn't aware of and key to this is that I only tell him about these after I have solutions for him. But mostly he's just glad that, by paying me, he can put these things out of his mind and use his mental energy elsewhere).

So, at the end of the day, the client is satisfied, I've done good work, and I've complied with my professional obligations. Sure, I had to do hours upon hours of work I can never bill for (which also means I didn't bill out other files I could've worked on instead), but I got to keep his business, do some business development with some senior calls nearing retirement, and learn some things I will probably draw on again in future. If you want to go solo, you have to be interested in the long game and I'm not going to be a junior call for very long.

 

Your story about how you service big fish guy is awesome. If I may ask, how do you go about reeling in a big fish like that so early on in your career? Again, maybe I am still going through the shock of articling where I basically only learned that I know nothing so I can't imagine going out there and trying to provide legal advice within the next 24 months. I feel giving out bad/wrong legal advice is basically a disservice to the client and our legal profession at large. 

So I guess my question is - how did you convince Big Fish Guy to give you a chance? Why wouldn't he have gone to someone with a bit more seasoning under his/her belt? Maybe legal fees is one factor? I suppose more senior lawyers also don't or won't give him the same time of day you would in terms of responsiveness. But obviously I'm just spitballing and guessing, and would love to hear you talk about it if you don't mind.   

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9 minutes ago, hmyo said:

 

Your story about how you service big fish guy is awesome. If I may ask, how do you go about reeling in a big fish like that so early on in your career? Again, maybe I am still going through the shock of articling where I basically only learned that I know nothing so I can't imagine going out there and trying to provide legal advice within the next 24 months. I feel giving out bad/wrong legal advice is basically a disservice to the client and our legal profession at large. 

So I guess my question is - how did you convince Big Fish Guy to give you a chance? Why wouldn't he have gone to someone with a bit more seasoning under his/her belt? Maybe legal fees is one factor? I suppose more senior lawyers also don't or won't give him the same time of day you would in terms of responsiveness. But obviously I'm just spitballing and guessing, and would love to hear you talk about it if you don't mind.   

I completely understand where you're coming from, but you're looking at it from the perspective of a legal professional, not a client.

You have to appreciate that this guy is actually younger than me (although it turns out this doesn't matter all that much) and has had little exposure to lawyers. So, in his mind I'm an authority (hopefully, THE authority). He contacted me through my website, which he found through google ads by searching "local lawyer" or something like that. Sometimes that's all it takes to get someone in the door; you just have to find a way to keep them coming back (e.g. throwing in some new Wills, usually not even at a discount, is usually an easy sell for clients who are already in the room with you). He did actually have one lawyer previously but fired him because it took him weeks to get back to him.

Most of the work that guys like me do doesn't generally involve big, old, institutional clients (except, in my case, trust companies, but that's a small subset). Most clients, even big ones, are regular people who are successful at what they do but not particularly sophisticated (typical, regular size, construction companies would be a good example of this: way richer than the lawyers they hire, but closely-held businesses run by essentially blue collar guys). The hardest thing is to get these people in the door, but it sometimes happens by chance. Because, at the end of the day, they're not looking for a 20 year call or a certified specialist. They just want someone they get along with and can trust (and, it's shocking how often we forget this, who will actually respond to them in a timely fashion). If you're responsive and decent to your clients, you could royally fuck up everything else and still be 50% of the way to keeping them happy.

Also, being young has its benefits. I've had multiple clients bring in family members because they, or others they know, have been left high and dry by lawyers retiring/dying. They want to consolidate all their documents in one place, with a young lawyer who gives off the impression of legitimacy and longevity. And this is not me inferring. Clients are explicit about this. They want to know that I'll still be here in 30 years. Legal fees are not usually a factor. They almost never even ask (besides, as far as solicitor work goes, I don't think my fees are all that less than senior calls in the area. There are going rates for various services and most of us are in that same ballpark)

The other thing about my area is that the bar is generally pretty grey, so there's a lot of frustration by clients that their lawyer doesn't get back to them or can't make time for them. This is a big deal for clients and is underappreciated by some lawyers. I took on two unrelated clients so far this week solely because their current lawyers were unresponsive to them and were taking months to get anything done. That's crazy!

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This isn't properly just a question for solo solicitors, but I thought I'd ask it here.

An opportunity has arisen for me to purchase a commercial property. It is an extremely interesting and historical building in need of some work (but not a ton as it was previously used as an office). The situation with the commercial market here, though, is such that a building like this only works if the owner is going to use it for its own business (rather than rent exclusively to tenants) and so the potential buyer pool is low. My plan would be to incorporate Mountebank Professional Corporation, buy the building, move my practice there, and rent out a portion of it to another tenant (assuming everything checks out with the municipality, but preliminary talks suggest they will let me partition the space horizontally).

Does anyone have any thoughts or experience as to law firms that own their own buildings? Should lawyers just stay in their own lanes and practice law? I have had discussions with other lawyers before who are always of mixed opinions. I've been a residential landlord so I at least have some experience with the work that goes into maintaining a building occupied by someone else. I do like that in my current space, I only have to worry about rent and the building manager takes care of everything else. But, this could be a good investment and presents an opportunity for growth down the road and/or an alternative income stream.

I know that there's only so much people can offer without more detail, but I would be grateful for any thoughts you may have.

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A number of senior practitioners in my town own their own buildings. I am not entirely sure which entity owns the buildings but I do know that at least two of them have their spouses as the sole title holder. 

I'm not sure that you can own the commercial building through a legal PC. It might depend on whether or not you lease any part of it out:

Quote

“5. The articles of incorporation of a professional corporation shall provide that the corporation may not carry on a business other than the practice of the profession but this paragraph shall not be construed to prevent the corporation from carrying on activities related to or ancillary to the practice of the profession, including the investment of surplus funds earned by the corporation. “

Even if you technically can, it might not be a smart tax move. An accountant's opinion could help. You may want to just own the building personally or through a numbered company. 

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I'm certain the PC can own the building and I'm pretty sure (but need to confirm) leasing it out is OK as well, especially if my practice operates out of it, since that isn't the carrying on of a business (rather, it's an investment ancillary to my practice).

The PC is more beneficial in my circumstances than the HoldCo from a tax planning perspective, though it does nothing for liability (that's what my insurance is for).

But I guess what I was asking about has less to do with the form of ownership than it does taking on a capital investment like this (however title is held) while also carrying on and building my main business.

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Are you planning to stay solo for the long term? It might make it more difficult/complicated to bring on a partner or additional shareholder down the road.

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31 minutes ago, Mountebank said:

I'm certain the PC can own the building and I'm pretty sure (but need to confirm) leasing it out is OK as well, especially if my practice operates out of it, since that isn't the carrying on of a business (rather, it's an investment ancillary to my practice).

The PC is more beneficial in my circumstances than the HoldCo from a tax planning perspective, though it does nothing for liability (that's what my insurance is for).

But I guess what I was asking about has less to do with the form of ownership than it does taking on a capital investment like this (however title is held) while also carrying on and building my main business.

Something you should consider is how much of your time do you want to spend being a landlord. I do have some words of caution coming from my time doing repair work for landlord's, you would be surprised at the amount of damage a tenant can do. If it were me (and im only an articling student so the weight of my advice on the legal practice side is light) I would be asking how much time I would be willing to be a landlord instead of a lawyer, and if the payoff is actually worth it.

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4 hours ago, Mountebank said:

I'm certain the PC can own the building and I'm pretty sure (but need to confirm) leasing it out is OK as well, especially if my practice operates out of it, since that isn't the carrying on of a business (rather, it's an investment ancillary to my practice).

The PC is more beneficial in my circumstances than the HoldCo from a tax planning perspective, though it does nothing for liability (that's what my insurance is for).

But I guess what I was asking about has less to do with the form of ownership than it does taking on a capital investment like this (however title is held) while also carrying on and building my main business.

I would be extremely hesitant to hold real estate in an operating company. To me, the potential risk to a going concern would outweigh most (if not all) potential tax benefits.

Would you be hiring a building manager to take care of the landlord duties? Or managing those yourself?

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It really depends on how good a deal you can get but buying a building for the practice can be extremely beneficial. It reduces the risk of the capital ownership because there is a guaranteed tenant, and the risk to the law firm by guaranteeing rent costs.

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On 8/13/2020 at 10:07 AM, Mountebank said:

This isn't properly just a question for solo solicitors, but I thought I'd ask it here.

An opportunity has arisen for me to purchase a commercial property. It is an extremely interesting and historical building in need of some work (but not a ton as it was previously used as an office). The situation with the commercial market here, though, is such that a building like this only works if the owner is going to use it for its own business (rather than rent exclusively to tenants) and so the potential buyer pool is low. My plan would be to incorporate Mountebank Professional Corporation, buy the building, move my practice there, and rent out a portion of it to another tenant (assuming everything checks out with the municipality, but preliminary talks suggest they will let me partition the space horizontally).

Does anyone have any thoughts or experience as to law firms that own their own buildings? Should lawyers just stay in their own lanes and practice law? I have had discussions with other lawyers before who are always of mixed opinions. I've been a residential landlord so I at least have some experience with the work that goes into maintaining a building occupied by someone else. I do like that in my current space, I only have to worry about rent and the building manager takes care of everything else. But, this could be a good investment and presents an opportunity for growth down the road and/or an alternative income stream.

I know that there's only so much people can offer without more detail, but I would be grateful for any thoughts you may have.

I would absolutely do this if it's got all the boxes ticked for you.

I will echo everyone else though and say that you should absolutely not hold this in your PC. Just as a starting point, I would never want to hold an asset with a PC. It's nice for you to act like your own landlord, there's benefit to having your own lease, paying actual rent to your own company, having slush funds in your holdco, easier to keep the two distinct if you want to sell one or the other, and on. Not any of my business how you do stuff, but there's probably a reason why every lawyer here is screeching bloody murder about holding real property in your PC (might be just reflex for billings, but I doubt it).

But that sounds exciting and good luck!

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Sorry for not saying so earlier, but thanks everyone for chipping in above. This has gone on the back burner as things have picked up a lot in the last couple weeks and I'm just trying to keep my head above water (not the worst problem to have, I appreciate).

I'll update if and when I proceed with this.

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