Help is on the Way:
In a month or so, I’ll have more depth in corporate and commercial work, having found an experienced and well-trained lawyer who can handle a wide variety of task in this area. This will be a major boon to cost efficiency, because in a recession, a higher proportion of deals are quite modest in dollar amount. I think that is the case because banks and private lenders are approving fewer leveraged deals now, so the deals that can go ahead are with purchasers who can self-finance.

The deal issues can be just as gnarly as the issues in larger deals, so legal costs can exceed expectations unless the scope or intensity of legal services are limited. Unfortunately, I frequently find that neophytes at doing acquisitions introduce an unnecessary level of complexity and novel terms to the table, and this always creates extra time. Clients say, “I just want to keep it simple” but in practice, they often don’t keep it simple.

What I’ve done in recessions up to now is to adopt the motto, “no deal is too small!” and then write off a large amount of the time spent to do the deal properly to protect my client. I can’t do what larger firms usually do, which is to pass the file down to more junior lawyers, articling students and even paralegals, with little input from the senior lawyer. My practice goal is to give owner/operator business the same level of expertise and experience that a large file would get at a large law firm. So, I needed someone who has good training and the service mentality I bring to files.

Even a modest amount of delegation will allow me to spend more time on the thorny file issues that arise. Importantly, I will also have more time to spend face-to-face with clients. Since I do so much by email (which is great for efficiency), I can go many months, even years without seeing long time clients. Unfortunately, this could lead those clients to the view that I take them for granted, and that is never the case.

Mandatory Continuing Education:
Starting 1/1/12, all lawyers and paralegals must fulfill minimum continuing education requirements. This is a good development – something the medical profession has implemented for years. Laws, policies, regulations and caselaw changes every second, and as a professional, every lawyer has an obligation and duty to keep current to maintain competency. I’m dubious that the high-powered, $750/hr. mega firm lawyers will spend much time in a classroom with the great unwashed majority of small and solo firm lawyers, but we’ll see.

I spend thousands of dollars every year to buy seminar materials, looseleaf services and textbooks in business law to stay on top of developments in my area. I’ve gone to many seminars, and one problem is that the people who give seminars don’t want to talk about the things that I want to hear about. Often, the seminar speakers want to wax on about their latest trophy deal with 12 zeroes in it, and such case studies are rarely of any relevance to me as a small business lawyer. My hope is that many lawyers share my view, and practical, specific courses and materials will be made available. We’ll see.

Fed vs. Ontario Incorporation:
Lately, I’ve had some clear reminders why I never, or very infrequently, recommend that a client incorporate federally under the Canada Business Corporation Act. Dealing with that Department can be very frustrating, slow and expensive. It can be agony and risky.

There is a belief among some lawyers and clients that a federal corporation has superior name protection rights as compared to a provincial corporation. I disagree with that – when I do a name search for a proposed corporation, I get a national search and warn clients not to take names the same or similar to names in other Canadian jurisdictions – even if they might be able to get them through the process federally or provincially.

Corporate names, business names and domain names are now the most troublesome part of any incorporation or start-up now, due to the fact that many businesses want to have a website and conduct business worldwide. So, depending on the nature of the business, it is often necessary to conduct global searches to ensure a name that will be defensible. Still, there are no guarantees, and a bigger party can bully a smaller party, even if the smaller party registered and used its name before such other party. That’s a good reason to make sure all possible business (not just legal) searches are done before a name is settled upon. Real creativity in the new name is essential.

Watch Those Limitation Periods!
It’s not new anymore, but very major changes to limitation periods for suing on contracts and other actions are still causing problems for tardy claimants. With such a short time period, the defendant party or its lawyer can mess you around for a long time and first thing you know, you’re out of time. Two years goes very quickly in the business dispute area, so beware.

Small Claims Courts Now Goes To  $25,000
Just a reminder. Sorry, I don’t do any litigation, be it small claims or otherwise.

DIY Incorporation
By some stroke of genius, the federal and Ontario provincial corporation branches have allowed lay people (ie, not paralegals or lawyers) to incorporate online. This has been a major boon to my practice, as 90% of new clients who use this feature must then spend much more than their perceived saving to correct serious errors in the incorporation. Believe it or not, lawyers don’t make a lot of money on incorporations, unless they spend zero time with the client. I typically spend 2 to 5 hours with clients, getting to know them, learning about their new business, discussing incorporation options (overview of corporate name & business name issues, type of share capital, issuance of shares, governance, need for shareholders’ agreement or not) and going back and forth if there are problems with the name (quite common) or capitalization.

The clerk’s time and out of pocket expenses (minute book, name search, incorporation fees, registration of business name) come to $800 - $900, and I quote $1500 ALL IN (all costs, my time and GST), so I end up with maybe 1-2 hours worth in the final bill if I’m lucky, frequently, it is less. That’s why I don’t chase incorporations by quoting loss-leader prices – I’m interested in building long-term working relationships, not doing a high volume of low-margin incorporations.