Law Practice
Management
Class #3 - The Law Office and
Technology 2 (Startup Costs, Staffing
and Employment, Filing and Office
Procedures, Library and Research)
Money Needed to Start Practice
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Savings
Working Spouse
Bank Loan
Loan or Gift
Credit Cards?
– Dodd-Frank Financial Reforms
– Last Resort
– Fast Trip to Bankruptcy
Benefits of Credit Card Usage
– Reduce check-writing costs
– Eliminate bank service charges
– Cut bookkeeping time
Credit Card Tips
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Use Multiple Cards
Get Rewards Cards
Never Pay Late
Never Miss a Payment
Regularly Ask for Credit Limit Increase
Stay Well Below Limit
Understand which rate(s) apply to which cards
Don’t mix business and personal charged on
same credit card
• Have Clear Plan for Repayment
Debit Cards?
– Debit cards don’t always have the typical $50
fraud or theft limit of credit cards – you can
lose everything in the account if you delay
reporting a lost or stolen card
– Dodd-Frank lowered merchant fees on debit
cards, but that may not benefit consumer much
Getting the money
• Refinance home (Dodd-Frank increased
qualification standards significantly)
• Loan from friend of relative
– Offer tax advantages of leasing equipment
and furniture to you (Foonberg pp 92-93)
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Investment tax credit
Depreciation
Interest deduction on borrowed funds
Other business expenses deductions consistent
with leasing business
Start-up costs
• Internet service (office, home, mobile)
• Paper/postage
– Stationary, announcements, business cards,
postage
• Rent/Security Deposit
– First, last (or last two month’s rent)
• Furniture/decor
– Consider buying used
• Malpractice insurance
– Leave adequate time to find a policy
• Telephone service
– VoIP (standalone), Bundled with cable or DSL, POTS
Budget for Student Loan
Repayment
Visit Tuition.io and Read Blog
10 Things You Could Do If You Didn’t Have Student Loans
Basic technology items for start-up
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Personal Computer (notebook or desktop)
Scanner
Word processing software
Email client or web mail
PDF creation software (e-filing requirements)
Laser printer
– Ink jet not suitable for law office use (Foonberg wrong
at p 107 in recommending ink jet)
• Fax machine not essential
– Foonberg again wrong at pp 107, 118
– Use Internet fax service instead, like Efax
New office checklist
Technology/Communication
• Determine need for telephone equipment
and lines
– Place telephone order in advance (2-6 weeks)
– Reserve phone and fax numbers
– Find right cell phone and plan
– Answering service or virtual assistant?
New office checklist
Technology/Communication
• Obtain high-speed Internet service
– Look for fast “business-class” service
• Consider Voice over Internet Protocol
(VoIP) for telephone service
– Vonage (and Virtual Number)
– Skype subscription, online number, phone
adapter, or phone.
– Ring Central Office
– Grasshopper
– 8x8
New office checklist
Technology/Communication
• Register Internet Domain (approx. $10/yr)
– Check availability
– Look for yourname.com or yournamelaw.com
• Determines email address
• Determines URL for Web site
• Look for Web Site Hosting
– Design Your Own and Use Cheap Hosting
– Use a Web Designer who also handles
hosting
New office checklist
Technology/Communication
• Advertising
– Yellow pages (expensive, not suitable for all
practice types)
– Community directories
– School athletic programs
– Web site or blog or both (WordPress)
New office checklist
Furniture – How lavish?
• May depend on the nature of your practice
• Expectations of clientele
• Consider skimping on personal office,
putting more $$ into conference room and
reception area
• Most important item in lawyer’s office is
comfortable chair
New office checklist
Furniture – Where to look
• Look into furniture rental
• Buy rental returns (off-lease)
• Check classifieds in local legal
newspapers or bar association
publications
New office checklist
Furniture – Lawyer’s office
• Desk
– 6 ‘ wide
• Desk chair
– Comfort and appearance
– Floor mat if office is carpeted
• Table, desk, or return for computer
equipment
• Client chairs
• Bookshelf
New office checklist
Other equipment
• Secretary/Assistant desk or station
• Chair
– Let assistant choose own chair if possible
• Dictation equipment
– Digital, not analog
• Small copier or scanner
– Outsource larger copy jobs
• Staples, Office Depot, Kinkos
• Postage scale/meter or Web-based postage
New office checklist
Office supplies
• Open charge account with one or more local office
supply stores or office superstores
– Staples
• Staples Rewards Card rebates (example of savings)
– Office Depot
• Worklife Rewards Card rebates
• On-line ordering
– Create a basic list that makes re-ordering simple
– Free delivery from some stores with $50 order
• Consider recycled or store-brand toner cartridges
New office procedures
Dictation
• Dictation is not a universal skill
– Need equipment even if you do most of your
own typing
– Short tapes (analog) or files (digital)
– Dictate punctuation if you expect it to be
accurate, spell proper names or difficult legal
terms
• Use outside services
– SpeakWrite (1.5 cents per word for legal
work)
New office procedures
Filing
• Use colored file folders for different types of
cases
• Use different colored paper in printer or copier to
distinguish different types of documents
• Design a new file information form (may want to
match to data used by your practice
management software
• Consider 3-ring notebooks (great for
trial/litigation practice)
New office procedures
Mailing
• Use self-printed stationary for non-critical
communications (court copies, etc.)
• Use “Address Correction and Forwarding
Requested on outgoing invoices
• Be meticulous about complete and correct
addresses
– Suite numbers
– 9-digit Zip code
• Open P.O. Box if post office is convenient to you
– Get mail on weekends, evenings
• Avoid USPS Express Mail for overnight
deliveries
– Go with FedEx, UPS, DHL
Technology/Equipment Purchases
The Great Equalizer
• False economy to have inadequate
equipment
• Right equipment and software makes you
more efficient and profitable
• Do everything a large firm can do, but
often faster, better, and cheaper
Law office technology
Where to start
• Ask around
– Don’t start with technology vendors
– Find a lawyer who has faced same problem
– Copy their solution
• Consultants
– Good ones are hard to find
– Once you find one, listen carefully
Strategies
Don’t Wait - Begin
• Form a group of lawyers at same stage of
practice
– Have monthly meetings to discuss common
problems and solutions
• Contact a practice management advisor
from the Bar
– LOMAS in Florida
• Work with a consultant recommended by
other lawyers
Used equipment?
Not usually a bargain
• Used PC’s are poor investment
– Nearly new refurbished or factory outlet PC’s
may be worth considering (Dell Outlet, HP
Business Outlet, Lenovo ThinkPad Outllet,
etc.) or discounted new at Microsoft Store
• Used laser printers
– May be OK, if price is rock bottom and printer
is HP LaserJet
• Used photocopiers (better to outsource)
– Only if you can get a service contract at a fair
price
Fax machines
• If you must have one, get a plain paper
laser fax
– Not thermal
– Not ink jet
• Consider a laser multifunction machine
that can do quadruple duty as printer,
scanner, and light copier too
– HP and Brother make several models
Scanners
• Auto document feeder (ADF) essential
• Duplexing is nice extra (scan both sides in
one pass)
• Look for bundled software to convert
scans to searchable PDF
• Some large copiers have scanning and
networking options, but few scan directly
to searchable PDF format
Entry-level law office scanner
• If it is a Fujitsu ScanSnap – Buy It.
– ScanSnap iX500 is new standard for solo and
small firms and desktop scanning for medium
and large firms ($495 list price, $410 at
Amazon)
Paper Shredders
Protecting confidentiality
• Trash can is not end of line for documents
• Nothing of a confidential nature should go
into trash can whole
– Client information
– Firm financial information
• Buy own shredder or use mobile
document shredding service
– Cross-cut or confetti shredder is best option
for office
Dumpster Diving & Trash
Rummaging
Telephones
• Buying own system can be prohibitively
expensive for new lawyer
– POTS local phone company
– VoIP from dedicated provider
– Digital phone from cable company
• Voice mail is essential
– Messages are often garbled in translation
• Answering service with routing to your
phone or to voice mail
– Personal touch for $50+ per month without
the staff expense
– Despite usefulness, many clients hate voice
mail
Smart Phones
• Best Choices – Android or iPhone, with
Windows Phone 8 improving (Blackberry is
dying and nearly dead)
• Network Coverage is Key (Verizon rates best,
AT&T worst in most markets)
• If Using Data Services for Tethering netbook,
notebook, or iPad to phone, consider a 4G
phone
– Cheaper to add tethering to smart phone than buy
separate Mi-Fi device and subscription
• Look for employee (spouse) discounts, family
plans, association discounts
Tablets
• Can replace notebook computer for many
lawyers
• Apple iPad clearly top choice today for
lawyers due to best app selection
• Android tablets and others not yet truly
competitive (No “iPad Killer” on market
yet, but 2013 Nexus 7 is closest so far)
• Microsoft Surface Pro 2 is expensive
($900+), but excellent
Software
Categories
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Word Processing
Time/Billing/Accounting
Practice/Case Management
Email Client
Web Browser
Scanning/OCR
Document Management/Search
PDF Creation
Word Processing
• MS Word is the leader
– Corel WordPerfect has faded to distant second due to
Word dominance in corporate world
• Consider alternatives to Word and WordPerfect
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Apache OpenOffice (free) W M L
LibreOffice (free) W M L
Kingsoft Office (free) W L A i
AbiWord (free and very basic) W M L
Google Docs/Drive (free – Web based ASP)
Zoho Docs (free – Web based ASP)
MS Office 2013 Info
• Office Home & Student ($140) - Word,
Excel, PowerPoint, and OneNote.
• Office Home & Business ($220) - Above
apps plus Outlook.
• Office Professional ($400) - Above apps
plus Access and Publisher.
Office 365 Subscription
• Office 365 Home Premium: Word, Excel,
PowerPoint, OneNote, Outlook, Publisher,
and Access. For $100 per year you get a
five computer “household license”
• Office 365 Small Business Premium:
includes the same collection of apps and
adds Lync and InfoPath, at $150 per user
per year, with each subscriber getting the
right to use the software on up to five PCs
or Macs and on “select smartphones and
tablets.”
Office 365 Productivity Plus
$12.49 per month per user - Demo
• Hosted Exchange Email
– 50 GB Email Storage
• Syncing of Email , Calendar, Contacts Across
Devices
• SkyDrive Pro 25GB Cloud Storage
• Lync (aka Skype Pro) Online Meetings
• Office Web Apps
• Office Mobile Apps for iOS, Android, Windows
Phone
• MS Office Desktop Software (Word, Excel,
PowerPoint, Outlook)
Doing your own word processing?
Could be a false economy
• Some lawyers can type as fast as they can
dictate long documents
• Short documents often easier to dictate
– But creating templates for common letters and
documents can alter this somewhat
• Speech recognition software
– NaturallySpeaking 12 is best yet
– Requires quality hardware
– Meshes well with digital dictation
– Not every lawyer can adapt to it
Time/billing/accounting
• Look for software designed for lawyers
– Manage trust accounts
– Do conflict checks
• Integrate all three functions
– Saves time
– Reduces errors
• Links to or incorporates practice/case
management
Practice/case management
PIM (personal information manager) on steroids
• Integrates calendar (docket), contacts, notes,
document creation, email, time keeping, legal
research, telephone calls, etc.
• Understands that lawyers work on cases or
matters, not contacts (flaw with using Outlook for
practice management)
• Look for link to or integration with
time/billing/accounting functions
• Training is critical
– No one can use such a system without training
Email
Distinguish between Clients and Services
• Email Clients (software on your computer)
– MS Outlook (Win & Mac, Exchange support)
– Mail (built into OS X, Exchange support)
– Thunderbird (free, Win, Mac, Linux)
– Opera Mail (free, Win, Mac, Linux)
– Postbox ($10, Win & Mac, great for Gmail)
– Evolution (free, Linux only, has Exchange
support)
Email
Email Services
• Exchange (self-hosted)
• Hosted Exchange (Cloud-based)
• Web Mail Services
– Gmail (most popular)
– Outlook.com (excellent user interface)
– Yahoo! (good security and filtering)
– GMX (great Facebook integration)
– AOL (don’t even think about it)
Web browser
• MS Internet Explorer (free)
– IE11 (Win 8.1 or Win 7)
– Most Web pages designed to display properly
in IE
• Mozilla Firefox (free)
– Huge selection of add-ons increase
productivity, cross-platform sync
• Google Chrome (free)
– Fast, cross-platform sync, growing library of
add-ons
Scanning/OCR
• Need speed and accuracy
• Must be able to convert to searchable
PDF
• Often bundled with scanner
• Adobe Acrobat (full version) is pricey, but
Standard is often bundled with scanner
and can upgrade to Pro
• Abbyy FineReader also pricey
Document management/search
• Amazingly useful, especially as you create
more documents
• Full-featured network-enabled software
like WORLDOX
• Free programs
– Copernic Desktop Search
– Locate32 (searches only file/folder names, not
data within a file)
– Windows Search (what I use)
PDF Creation & Editing
Necessary for efiling, doc sharing, etc.
• Adobe Acrobat XI Professional (full
version) expensive at $450
• Good Alternative – Nitro Pro ($140)
• Free alternatives
– Cute PDF Writer
– PDF 995 ($9.95 without ads)
– PrimoPDF
• Adobe Reader
– Free, but slow to load
– Fast alternative is Foxit Reader
Personnel Issues
• Hire staff (traditional employer-employee
relationship)
• Do it yourself (may be only choice if budget
is tight
• Virtual Assistant (could be located anywhere
in world with VoIP and other technology)
• PEO (Professional Employer Organization)
and lease your staff
– TriNet and ADP are large players in local
market.
Other start-up issues
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Keeping track of prospective clients
Getting info from prospective clients
Bookkeeping/Accounting
Filing
“Prospective client” file
• Cases you turned down or client went
elsewhere
• Can still be source of referral business
• Always record names and addresses
along with basic facts
– Will need this for conflict checks – enter into
time/billing program or practice management
program
– Consider adding to mailing list for newsletters,
announcements, etc.
Ready for first clients?
Before the initial meeting
• Get info first, then advise and quote fee
• Get info by phone if possible, do research
before initial meeting
• Have prospective client fax or email key
documents in advance of meeting
• Consider having an intake form on web
site for client to fill-in or download and
return in advance or at meeting
Personnel Manual
• Can’t be an “ad hoc” employer dealing
only with issues as they come up
• Don’t reinvent the wheel
– Copy another firm’s manual
– Buy a manual with CD from the ABA
– Buy CD with sample policies from LOMAS
– Customize as needed, carefully
• If you go with a PEO, they will provide
manual
Bookkeeping/Accounting
• Get a CPA
– Tax planning
– Tax return preparation
– Referrals
• Consider a payroll service
– Traditional
• ADP
• Paychex
– On-line (ASP)
• Intuit Payroll
– Use Accounting software (and backup!)
Use a filing system
• Vertical instead of horizontal file
orientation saves space
• Keep it simple
– New file for each matter
– Reverse chronological order (newest on top)
– Use Year-Matter numbering system
(coordinate with practice management and
time/billing software)
Maintain a filing system
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Keep current in filing (yes, it’s a pain)
Remove duplicate copies
Return valuable original documents to clients
Move closed files to lower cost storage
Keep an index of closed files and their location
Know when to close and when to destroy a file
– Include file destruction policy in fee
agreement
File destruction policy
Clause in fee agreement
The Client understands that the Attorney is not
obligated to keep the Client's file indefinitely. The
Client consents in advance to the Attorney destroying
the Client's file 2 years after the file is closed and the
matters for which the Attorney was engaged have
been completed or 2 years after the Attorney has
been discharged by the Client or has ceased
representation of the Client by operation of law or
court rule, whichever occurs first.
Client communication issues
• Get client OK in writing before sending
information by email, fax, or to work
address
– Include options in client intake form
• Indicate your preference to client
– Email much easier than telephone calls when
budgeting time
• Clients hate voice mail, so let them know
that email may result in faster response
Respond promptly
• Client dissatisfaction rarely related to
quality of legal work or advice
• Nor is winning or losing the key factor
• Failure to communicate in a timely way is
the fault most likely to cause problems
– Slow pay or non-payment of fee
– Grievance with the Bar
– Malpractice litigation
• Lesson: Don’t procrastinate, even if the
call will be unpleasant
Problem #3
• What hardware, software, and services
must you have to start your own law
practice?
• Are there ways to economize?
Law Practice
Management
Class #3 (cont.) - The Law Office
and Technology 2 (Library and
Research)
Library needs and costs
• Foonberg, p 489
– California survey on
library costs of new
lawyer opening
practice (1998)
– Does not include
rental and other costs
for space required by
books
Up front Upkeep
Hard
$29,000 $12,000
Copy
CD$7,000 $12,000
Rom
On-Line $0
$6,000
Internet $0
$0
Internet as library resource
• More legal material coming into public
domain and available on-line for free
– State-specific sites for cases, statutes, rules,
AG opinions, and forms
– Portal sites such as FindLaw and Rominger
– Lawyer sites such as Florida Law Online
Useful sites
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Black Book Online
Driver’s License Status
Corporations and Other Entities, Jmt Liens
Marriage Licenses and other recorded
documents
• Vehicle Records
• Real Estate Records
More Useful Sites
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Prison inmates
Arrest records (Pinellas Co.)
General Fact Finding (how-to article)
Free Federal Research (how-to article)
11th Circuit Opinions
U.S. Supreme Court oral arguments
Commercial Electronic Research
• Lexis.com
• WestLaw
– Need to work through their sales rep to
determine cost
Discount commercial electronic
research providers
• LoisLaw
– $29.95/mo and up
• VersusLaw
– $24.95/mo for all states cases and statutes
• FastCase
– Free state case law for FL Bar Members
– Upgrade to Federal and every state case law
for $195/yr
Problem #4
• How much would you budget for research
costs?
• How would that total budget be allocated?
• Would you bill research costs directly
(itemized or flat rate) or indirectly (hidden
in overhead) to your clients?