Here are some thoughts on finding, hiring, working with and firing an attorney for a nonprofit organization. A lot will depend on the issue you are addressing. If you are at the beginning of incorporating an organization the talents you need from an attorney are different than one seeking legal help for a grievance by a current or former employee. This article will be general in nature to give you some guidance in the selecting an attorney for your NPO.
The basic choice is to find an attorney or small law firm that features or includes representation of charities, nonprofit or philanthropic organizations. The second choice is to seek either an experienced and interested corporate lawyer or a tax lawyer. The third choice is a lawyer with interest in your mission and endeavor who will put in the necessary time to learn the law and to process the papers with all due haste and timeliness.
If you do not know any attorney to help you there are a number of steps you can take to find one locally. You can use all of these listed here or any variations. The sections covered by this article are –
- Check the Yellow Pages
- Attorney Referral Service
- Martindale-Hubbell Directory and Other Sources
- Ask Friends and Contacts, In the Community and Google the Attorneys
- Planning the First Meeting
- Legal Wellness Check-ups
- Finding a Pro Bono Lawyer
- Working with an Attorney
- Your Attorney on the Board
- Concluding the Lawyer-Client Relationship
- Firing a lawyer
Check the Yellow Pages
Check the Yellow Pages of your telephone book under “Attorneys”. Read the ads. Check the subsections where there are listings or groupings by type of law. Select several possible candidates. Large ads do not equal quality or experience. Look for lawyers who have listed the issue you need assistance with, such as “Charities,” “Business” or “Employment Law.” Do not simply pick someone out of the phone book. A lawyer listed under a specific category does not mean she is a certified specialist in that field. A person in “General Practice” may or may not include nonprofit issues.
In a search through my local telephone Yellow Pages in Rochester NY I did not find any listings such as “Charities,” Philanthropy,” or “Nonprofits” nor any attorneys listing those words. In some states attorneys are permitted to advertise they are a “certified expert” or similar language. A “certified specialist” has received more education and is more likely to have had actual courtroom experience than a non-specialist, but it takes more than that to be a good lawyer. You will almost never find a lawyer certified in charity or nonprofit law.
Be cautious with attorneys whose name you find under all or many subcategories of law. The law is too complex for an attorney or law firms to stay current in al phases of legal issues.
Do not stop with the Yellow Pages.
Attorney Referral Service
Call the local Attorney or Lawyer Referral Service (ARS) listed by that name in the Yellow Pages. Generally the ARS has a listing of lawyers by type of law they practice. Be certain it is operated by the local Bar Association. Some similar listings are operated by a group of attorneys.
In the ARS lawyers usually select the listing themselves as areas of law they handle or are interested in. It does not set expertise. The ARS will give you one or more names of attorneys signed up for tax-exempt, nonprofit, and corporate or tax law.
The normal process is that you can have a half-hour free consultation with an attorney about what you want. The ARS will charge a referral fee that is either paid to the ARS directly or to the attorney who sends it to the ARS. Get a receipt. The fee is usually $25-50.
Ask the ARS receptionist if the ARS requires the member attorneys to have malpractice insurance and if they must report any ethical or malpractice claims to the ARS. The ARS’ ad in the yellow pages may state that all members are covered by malpractice insurance. If the ARS requires these, it is helpful for you to know that. It is still advisable to ask around about the lawyer you will have referred to you. Check with the state bar to see if there are any public disciplinary decisions against the attorney.
Martindale-Hubbell Directory and Other Sources
I suggest you add to your research the Martindale-Hubbell Directory that provides you with basic information and biographies of most attorneys in your area. It includes a rating based on polls of how their peers evaluate them in terms of ability, expertise, and integrity.
The Martindale-Hubbell Legal Network is currently powered by a database of over one million lawyers and law firms in 160 countries. The Martindale-Hubbell Law Directory is currently accessible:
- On the Web, at martindale.com
- Online through LexisNexis
- On CD-ROM
- in the 26-volume print edition
Martindale Hubble is also associated with Lexis/Nexis and Law.Com where you can do additional research under specific topics, such as “Charities” and “Philanthropy.”
Other resources are available at Lawyers.com which has a page where you can search for lawyers who specialize in nonprofit law by state or province.
See also the American Bar Association publishes a consumers guide to finding legal help.
FindLaw provides a data base of experience. The site however does not have a category of charities. You may find some information through a search on “Business Organizations” or “Small Businesses” for instance. There are advertisements here so be careful to know what an ad is and what is information.
Finally you can review this article on Attorney Directories and a 50 State Survey of Online State Bar Directories
Ask Friends and Contacts, In the Community and Google the Attorneys
Ask around in the community about lawyers in the context of your needs. Call some nonprofits or the United Way for names of attorneys known to help nonprofits. Check the Internet. Contact the state university to see if there is a state coop branch near you. Under all these scenarios, be sure to seek all the information you can about the lawyer(s) including Googling them.
The National Council of Nonprofit Associations (NCNA) may have an associate office in your State. Offices are listed at ncna.org. Your State office may be able to assist you in locating an attorney.
Planning the First Meeting
Plan your meeting or consultation with the attorney. Many attorneys offer a free 30-minute first consultation.
Do your homework. Prepare what you want to say to the lawyer about what you are seeking. Be aware your first visit may be about a half-hour and your story should last about 5 minutes or less. Take all documents you believe are relevant. Make copies to leave with the lawyer.
Prepare questions such as:
- What is her experience with charities’ law?
- What is the nature of that experience?
- Will there be a retainer agreement or letter of scope of service with deadlines?
- Has she attended any continuing education classes on charity law?
- What are the fees and possible costs?
- Verify the lawyer has malpractice insurance.
- Assess the lawyer.
Some attorneys have a low-fee plan that is between pro bono and the usual fee – ask if there is one.
Will an attorney take on the representation on a contingency basis? What is the contingency? Usually the contingency is in accident cases where if you win the attorney receives her pay contingent on a favorable judgment for you. Don’t even bring it up if this is not a personal injury case.
I recommend two people from your group prepare for and go to the first consult so that after the meeting you can talk about your impressions and whether this is the lawyer for your project. Agree what each will and will not talk about.
See the excellent check list Twelve Questions to Ask Your Lawyer and other material, for some helpful discussion about hiring a lawyer.
Find out about a written retainer agreement and/or letter of scope of service – they are important for details about what the ultimate product will be, deadlines, and what you are paying for. Many attorneys and law firms charge by the hour.
There is a small number of firms that charge a set fee for specific activities. For instance if you are meeting with an attorney to help incorporate an organization be specific about what is included: state incorporation papers and process, development of bylaws, filing for IRS recognition, meeting with the board to provide an overview of legal wellness for a nonprofit group in your state – and is there a separate fee for each?
There are helpful articles about planning your first consultation with an attorney. In addition to the links below you may find other articles at the web site for your state’s Bar Association
Legal Wellness Check-ups
New organizations seem to believe that legal issues are over once they have received the letter of recognition from the IRS as tax exempt. I am suggesting they are only beginning. When I read various discussion boards about nonprofits facing legal issues, it is very shocking how people will guess at answers about what to do.
- Can we pay board members?
- Can I ask volunteers for their Social Security numbers?
- What can I do when the executive refuses to give any financial information?
- Can family members serve on the board and be hired as staff members?
- Do we have to follow the language of this grant contract so closely?
- When they say we have to be transparent, how transparent do we have to be?
- Are there new IRS rules that will affect us in the next year or two?
- Why do we need to do an audit?
- How long should we keep (fill in type, such as contracts, board minutes, job applications, employee records, etc.) records
A guess from a stranger will not hack it. Nonprofit boards and staff need periodic legal wellness checkups particularly but not exclusively about written policies and procedures, bylaws, contract compliance, employment and recordkeeping to mention a few. If there is one place where groups of nonprofit organizations can partner in cost-sharing is in a refresher course on legal wellness once every one or two years. United Ways, Community Foundations, Community Colleges and others can develop with nonprofit leaders legal wellness clinics that are inclusive beyond membership relationships.
Finding a Pro Bono Lawyer
There is an outside possibility you can secure a pro bono attorney. “Pro bono” means for the public good, at no cost. Many attorneys provide pro bono work but not always for nonprofits.
If your group will be providing service to a low-income community, call the local legal services program, sometimes also called legal aid. Many legal services programs and sometimes the ARS will have a pro bono program. If your group qualifies and there is an attorney familiar with charity and tax exempt law on the panel, you may find a free attorney. You can find the name of a legal services program near you through the Legal Services Corporation. If they cannot help, ask if there is another free legal services program in the community.
If there is a law school in your community, it may have a community law clinic or a professor who is interested in the same issues you are and who may help.
I suggest that you assess a possible pro bono attorney as you would one you will pay. Check on the experience and do your background research suggested above.
The difficulty may occur in access to the pro bono lawyer. When you pay for time, access can be better, but you pay for each contact. When the service is free access may be less. My experience is that most pro bono attorneys do an excellent job. Be certain to develop a retainer agreement or a letter describing the scope of service with time deadlines and provide other helpful advice. Your group will still be responsible for all filing fees and other costs such as incorporation costs with the State and the IRS.
Realize, however, you are probably going to pay for legal assistance. In that case, at the first meeting ask about the costs for the attorney time.
You may secure a pro bono attorney but you have to be prepared in case you do not succeed. The cost of filing all the legal papers with the State and the IRS along with paying an attorney can rise quickly. Planning early on for these initial costs is part of developing a business plan. It is part of the cost of doing business.
Working with an Attorney
When you have decided upon an attorney or law firm, you well be entering an attorney-client relationship. This is an important concept for attorneys and clients. You are to receive the best quality of representation in a timely and ethical manner. The attorney’s loyalty is to the client.
It is my belief there are two “experts” in every lawyer-client relationship. The client is generally the expert on the facts; the lawyer is generally the expert on the law and legal procedure. You are partners. The lawyer should share all possible options. The ultimate choices and decisions are the clients.
You the client have some duties to perform in the relationship. In no particular order those duties include:
- Know your goals in utilizing an attorney. Be clear what your expectations are.
- Tell the truth to your attorney and provide all relevant documents.
- Understand that the attorney may not know all the acronyms and buzz words you use in the work of the organization.
- Be prepared to do homework on your case. The attorney may need more information that only you and the organization have. For instance the attorney will not write a mission statement for you or answer all questions on IRS Form 1023 without your hands-on assistance. And do your homework timely and as fully as possible.
- Keep your attorney informed but do not be a pain-in-the-neck with irrelevant contacts.
- The attorney does not have to hear the problem(s) from the beginning of time or from the 15th century. Get to the latest relevant facts and let the lawyer help you explain the facts needed.
- Agree on what you will do on the case and what the attorney will do.
- Listen to the attorney’s advice and support. Take notes as needed.
- Ask questions when you do not understand or are not sure what the legal process is.
- Have patience.
For additional guidance see Seven rules for working with an attorney.
Your Attorney on the Board
Many of you will not like this section. But here it goes. Do not recruit an attorney for your board with the hope and ambition that the lawyer will do the organization’s legal work, from incorporation to defending the group in a law suit. Do not do it. If you asked me to serve on the board and you also expected me to do legal work, I would politely and instantly decline the invitation. If I am going to serve on the board I will not be the group’s attorney although I may have a perspective from time to time that I will express with the board.
I understand there are many attorneys who share a concern about a group’s mission, vision, values and passion and want to help. I would hope there would be more. At the incorporation of the organization an attorney-board member may provide assistance but see again my comments on “hiring” an attorney above.
Once an attorney is on the board of directors, she is as vulnerable to legal action as all other board members. That attorney-board member cannot be a defendant and the lawyer for the board and perhaps for staff also at the same time.
An attorney-board member can be enormously useful as a member who shares the mission, vision, values and passion – and brings a legal training to the discussions and decisions. Attorney-board members may face conflict-of-interest issues from time to time. Respect those moments as you do for all other board members.
Concluding the Lawyer-Client Relationship
The relationship between the nonprofit organization and the attorney will probably be dictated by the written agreement between them. There is a beginning, a middle – the representation – and an end. Both you and the attorney should be in synch about what concludes the relationship, an act or a date or both.
Any new work not in the initial agreement will require a new written arrangement. A written agreement protects you and the lawyer. Once again, you should request a letter showing the scope of the work the attorney will perform with a timeline.
In the for-profit business it is not unusual for smaller and medium size corporation to have a retainer agreement where the company pays a certain fee for the law firm or attorney to be available for consultation each year. It is also not unusual for larger nonprofit organizations to have a firm on retainer. It is part of the cost of doing business.
Firing a lawyer
What happens if you are dissatisfied with the attorney? She is not returning your telephone calls? She is not meeting deadlines? There is a clash about the handling of matters or personalities.
Yes, you can fire your attorney. But be very careful in the process. Are your expectations too high and you are asking too much? If you are facing a choice send the lawyer a brief factual letter and ask for a response. Based on the answer you may still want to fire her. You can. You may still be liable for unpaid fees and costs. You may want to seek an alternative attorney before you actually fire her. Have a meeting with the second lawyer before doing the deed.
There can also be reasons for filing ethical charges against an attorney with the state licensing board, the state bar or the state’s highest court. Check their web sites for guidance.
For further information and ideas when unhappy with your attorney see:
When You Are Unhappy with Your Lawyer FAQ
Conclusion
I have not covered all contingencies for a nonprofit seeking legal assistance. There are too many permutations. It is my hope you have found some considerations to make your experience with an attorney or firm as positive as possible.
My very best to you, the organization and its mission, vision, values, passion and actions.
I am required to tell you that I am a licensed attorney in New Jersey. It is my understanding you are not seeking legal advice. It is not my intent to provide you with legal advice. We are not entering a lawyer-client relationship. I may have given you legal information but I have not given you legal advice. I do not accept clients for any issue for pay or for pro bono work.
Don Griesmann
