Ten guidelines for engaging association lawyers. (Legal).

While there may be no completely right or wrong way to go about locating and hiring an attorney or law firm to represent a nonprofit membership organization, some guidelines can be helpful. Part of the process includes recognizing unique requirements that may apply to associations with a need for expertise in particular areas of the law. However, general guidelines apply to nearly every nonprofit organization and this article describes some of the most important ones. The reader is respectfully asked to suspend disbelief in considering these guidelines for engaging association lawyers--emanating as they do from an association lawyer.

Following are 10 guidelines for nonprofit membership organizations to consider when engaging legal counsel.

1. Recognize that trust is the most important quality. The acid test for choosing an association's attorney is based on the answer to one question: Does this attorney--or team of attorneys--inspire trust? Beyond educational degrees, legal victories, clientele, or other attributes, legal counsel should be a professional, or professionals, on whom your association staff and volunteers are prepared to depend absolutely and without equivocation. The trust factor can emerge in interviews and meetings, but it is ultimately established through experience. Thus, it is crucial to seek references from clients of prospective association counsel.

2. Look for expertise and experience. Nonprofit organizations have caught up with corporations in learning to select counsel based upon a careful evaluation of expertise and experience. Some of the ways once used by nonprofits to select an attorney--familiarity with association members, general reputation, or succession from a longtime former counsel--have given way to a more methodical process of reviewing professional credentials. Expertise and experience can be confirmed through requests for written proposals, interviews, review of attorney or law firm Web sites, other Internet searches, and references.

3. Keep in mind that responsiveness may trump credentials. A trustworthy and expert counsel is of little value if he or she is hard to reach, always seems pressed for time, or too often passes off a problem or task to a colleague. An American Bar Association survey of major business corporations' inside general counsels once disclosed an astounding fact: Highest on the list of attributes sought in a lawyer was not a top law school degree or renowned litigation victory; most of all, these major corporate clients wanted an attorney who would simply return their phone calls. Responsiveness can be evaluated through reference checks and inquiries--and can be required in the engagement agreement. The offering of a cell phone number or home number in case of emergencies can indicate the kind of responsiveness you expect.

4. Clarify legal needs in advance. Association leadership must decide on the criteria or profile that would define the right attorney for the organization's purposes. Some associations need an attorney or firm that understands nonprofit corporations, federal income tax exemption, antitrust compliance, nonprofit organization transactions, and the other general areas of association law. Others have greater need for counsel knowledgeable in unique areas of law crucial to the associations and their constituencies--environmental regulation, labor relations, lobbying, and so forth. Rarely, however, does an environmental or legislative expert have detailed knowledge of laws that singularly affect associations. One strategy is to look for a law firm with professionals who cover all the bases.

5. Ensure that fees and charges are affordable. Too many associations make the mistake of engaging attorneys based mostly on costs. But inexperienced or inappropriate legal counsel can, in the long run, turn out to be a very expensive choice indeed. Some lawyers and law firms may offer discounts against their regular rates to have the honor and visibility of representing an important nonprofit organization; most firms, however, provide pro bono representation only to entities or individuals that would not have the resources to engage counsel at all. Carefully approach situations in which attorneys are offering discounts because they are primarily seeking a platform for marketing their services to the association's constituency. Ultimately, the most affordable association counsel is likely the one that is most efficient. It is worthwhile, then, to focus on candidates that are able to provide the best counsel and advocacy in the least amount of time. Usually, that means counsel with the most experience.

6. Evaluate hourly fees against retainers. There are advantages and disadvantages to either type of billing method. While an hourly fee arrangement ensures that the association pays for no more than the actual time worked by attorneys on its issues, fees are open-ended and run the risk of exceeding an association's budget. Retainers--in which the association pays a monthly fee to cover all anticipated legal work--can be best for budgeting purposes but inevitably result in paying either too much or too little for legal services. As a compromise between the two approaches, it is not uncommon to ask legal counsel to use their best efforts to keep hourly fees and costs within budget targets, with periodic review and cooperation between lawyer and client.

7. Specify the attorney's role. The association's attorney should provide legal counseling and advocacy--no more, no less. Too often the association's attorney comes to have significant say--or even control--over management, governance, and other aspects of association operations, even when no clear legal issue is raised. Beware the attorney who sees a legal risk or problem behind every initiative or decision. Associations are unique legal entities that face myriad singular legal, tax, and related issues on a regular basis--adequate domain for the association attorney. Both the client and the attorney should vigilantly confine input and endeavors to legal counseling and advocacy.

8. Determine whether counsel will be permitted to also represent members. The association's leadership may prefer to seek association counsel who will not represent members. They certainly have the prerogative to make that a condition of engagement. However, often it is seen as an advantage to the association to have its legal counsel involved in individual members' legal work in order to stay current with issues affecting the membership. One way or another, clarify this in advance to avoid misunderstandings.

9. Limit meetings that counsel should attend. It was once common for associations--especially trade associations--to have counsel attend all board of directors meetings and other meetings in which legal issues were expected to arise. Today, this is not always an efficient use of an attorney's time, and counsel is more likely to be asked to merely check agendas and minutes for legal ramifications and attend those meetings, or those portions of meetings, wherein important and current legal matters are to be discussed. Every association should have an antitrust and legal compliance policy in place; counsel should periodically attend meetings to update, reinforce, and ensure compliance with that policy.

10. Periodically review the relationship. Regular, candid dialogue between association leadership and association counsel should characterize the relationship. There should never be a hesitancy to discuss fees and expenses or to question association counsel's analysis and conclusions (although there can be significant legal risks in proceeding against the advice of counsel). When communication is open and honest, it is unlikely that the relationship will become so strained that it must be severed. If so, however, the association should look to the terms of the original engagement for termination provisions. In most states, the attorney is responsible for providing any files or materials without charge to the former client association if withholding them could in any way jeopardize the association's legal interests.

Jerald A. Jacobs is a partner in the Nonprofit Organizations Practice at the law firm of Shaw Pittman, Washington, D.C. Jacobs is general counsel to ASAE.